How can managers manipulate EPS?
What will be an ideal response?
Answer: Analysts frequently forecast a company's EPS. Company management tries its best to meet such forecasts. By manipulating estimates of some asset and expense accounts, it is conceivable to fine tune costs and income to meet the numbers. Officers and managers may have bonuses contingent on achieving forecasted EPS and they can carefully craft a strategy to receive their bonuses. They can also buy back or issue corporate shares to manipulate the denominator.
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When rumors are designed to damage someone's reputation, these rumors are known as:
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