Question

Which of the following will result in an increase in earnings per share?

• A. Accruing expenses at year-end.
• B. Selling additional shares of common stock during the year.
• C. Accruing revenue at year-end.
• D. Receiving cash from a tenant that is recorded as unearned revenue.

Answer 1

The correct option is C

Accruing revenue at year-end.

Answer c. Accruing revenue at year-end

Explanation: Accruals are adjustments for income that has been acquired, yet isn’t yet presented on the general ledger accounts. As they are the revenues earned, the shareholders are entitled to such profits.