# Calculate Earnings Per Share?

Earnings per share is the amount of a company's net income per share of common stock. The portion of earnings per share is the one used to determine a company's earnings over the previous twelve months. Determine the company's net income, the preferred dividends and outstanding common stock. The company's balance sheet documents contain the amount of outstanding common stock. For example, Firm J has £62527 of net income, £625 preferred dividends and 500 outstanding common shares of stock for the previous 12 months. The calculation is to subtract the preferred dividends from net income. In our example, £62527 minus £625 equals £61902. Then divide the number calculated above by the amount of common shares outstanding to determine TTM earnings per share.
How to Calculate Earnings Per Share
In order to calculate earnings per share, take all of the profits of a company after taxes and divide this by the total number of common shares. Find out why the money that goes into preferred stock holds usually has to be removed from net profits before... More »
Difficulty: Moderate
Source: www.ehow.com
Earning per share is the amount of dividend that a shareholder gets per share. It is calculated using the formula: DPS (DIVIDEND PER SHARE)= DIVIDENDS PAID/NUMBER OF SHARES IN ISSUE.
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