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MC Question 13
Many commentators believe that the trend of earnings per share (EPS) is a more reliable indicator of underlying performance than the trend of the net profit for the year.
Which of the following statements supports this view?
| A | Net profit can be manipulated by the choice of accounting policies but EPS cannot be manipulated in this way |
|---|---|
| B | EPS takes into account the additional resources made available to earn profit when new shares are issued for cash, whereas net profit does not |
| C | The disclosure of a diluted EPS figure is a forecast of the future trend of profit |
| D | The comparative EPS is restated where a change in accounting policy affects the previous year’s profits |