1.   And you have to do the same thing in the equity denominator, which is determined by dividing net income by outstanding equity.

2.   It is different than the mean, or average, which is calculated by dividing overall income by the units in a group.

3.   The margin is calculated by dividing operating income, less the cost of goods sold and operating expenses, by sales.

4.   You arrive at the basic figure by dividing income by the average number of common shares outstanding.