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Net Income Applicable to Common
Investing Lesson 4 - Analyzing an Income Statement
 More of this Feature

• Introduction
• Income Statement
• Revenue / sales
• Cost of Goods Sold
• Gross profit
• Gross margin
• The first three lines
• Operating Expenses
• R&D Expense
• SG&A Expense
• Goodwill Charges
• Extraordinary Events
• Accounting for extraordinary events
• Oper. income/margin
• Interest income and expense
• Interest coverage ratio
• Depreciation expense
• Accum. Depreciation
• Straight-line Method
• Accelerated and Sum of the Years' Digits Method
• Dbl Declining Balance
• Comparing Depr. Mths
• EBITDA
• Income taxes
• Minority Interests - cost, equity, and consolidated methods
• Unreported earnings
• Continuing operations
• Accounting changes
• Preferred dividends
• Net income applicable to common shares
• Net profit margin
• Basic vs. Diluted EPS
• Hiding share dilution
• Share repurchases
• Return on Equity- ROE
• Asset turnover
• Return on Assets- ROA
• Projecting earnings
• Formulas & Calculations
• Putting it together

• Segment 2

 Related Resources
• Investing Lesson 1
• Investing Lesson 2
• Investing Lesson 3
• More Lessons
 From Other Guides
A Typical Income Statement including Net Income Applicable to Common
 Elsewhere on the Web
• Net Income Applicable to Common
• Net Income

Net Income Applicable to Common Shares
The net income applicable to common shares figure is the bottom-line profit the company reported. To get the basic earnings-per-share [Basic EPS] figure, analysts divide the net income applicable to common by the total number of shares outstanding.

The last line, at the bottom of the income statement is the amount of money the company purports to have made (net income, total profit, or reportable earnings; it’s all the same). Hence the cliché, “what’s the bottom line?”

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