Unformatted text preview: return on assets calculated? Would a company want this ratio to be higher or lower than its return on equity ? Why? It is calculated by dividing net income by total assets. You would want this ratio to be high because that would mean you are efficiently using the assets. (4) What is meant by outstanding shares in the calculation of earnings per share (EPS)? Stock currently held by investors, including restricted shares owned by the company’s officers and insiders, as well as those held by the public. Shares that have been repurchased by the company are not considered outstanding stock....
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- Spring '08
- Balance Sheet, Financial Ratio, Generally Accepted Accounting Principles