What is EPS? Why balance sheet always match?

Question

Accepted Answer

EPS stands for Earnings Per Share. Balance sheet always matches due to the fundamental accounting equation.

EPS is a financial metric that measures the profit earned by a company per outstanding share of common stock.
It is calculated by dividing the net income of the company by the total number of outstanding shares.
Balance sheet always matches because of the fundamental accounting equation which states that assets must always equal liabilities plus equity.
This means that every transaction recorded in the balance sheet must have an equal and opposite effect on both sides of the equation.

Accepted Answer

EPS stands for "earnings per share." It is a financial ratio that represents the portion of a company's profit that is allocated to each outstanding share of common stock. EPS is calculated by dividing a company's net income by the number of its outstanding shares of common stock.

As for why the balance sheet always matches, it is because the balance sheet is a financial statement that shows a company's financial position at a specific point in time. It lists all of the company's assets, liabilities, and equity. The balance sheet must always be in balance because the total value of the company's assets must always equal the sum of its liabilities and equity. This is known as the "balance sheet equation," which states that assets = liabilities + equity.

In other words, the balance sheet represents a snapshot of a company's financial position at a particular moment in time, and it must always be in balance because the total value of the company's assets must always equal the sum of its liabilities and equity. This is true regardless of whether the company is profitable or not.

What is EPS? Why balance sheet always match?

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