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Earnings per Ratio

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Earnings per Ratio

  • This topic has 1 reply, 2 voices, and was last updated 11 months ago by P2-D2.
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  • February 8, 2022 at 5:50 am #648267
    James124
    Participant
    • Topics: 159
    • Replies: 136
    • ☆☆☆

    “EPS is used to calculate price earnings ratio”.
    Can you please explain this sir?

    February 9, 2022 at 9:04 pm #648395
    P2-D2
    Keymaster
    • Topics: 4
    • Replies: 6460
    • ☆☆☆☆☆

    Yes, the P/E ratio is the price per share divided by the earnings per share (EPS. In this case w take the quoted share price and divide by the calculated EPS.

    Thanks

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