For private companies, Earnings Per Share is not an exact science. The measure tells you that for every unit of money your business has in owner’s equity, you are earning XX units back. We do make assumptions however, that can derive a consistent indicator as to how efficient your business is in generating revenues relative to the total amount of equity within your business. Although not scientific, it can be used as a good barometer as to the progress of your business over time. Check your earnings per share now with Jazoodle

Definition used:

Net Total Profit Divided by:

Total Equity (amount)

eg: Net Profit $30,000, Total Equity $5,000

EPS equals 30,000 / 5,000 [times 100] = $6

If your company earnings per share is reducing, there are a number of things you can assess to identify the cause, and then improve the score. As always, please work with your accountant or business advisor for individual advice for your business. EPS is affected by the following:

• Sales revenues.
• Cost of goods (direct costs)
• Overheads or expenses
• Other non operating income or expenses
• Financial structure of your company