Sales revenue$745,000Cost of goods sold450,000Selling expenses58,000Administrative expenses72,000Loss on sale of equipment5,000Income tax expense64,000Shares of common stockOutstanding...

Sales revenue$745,000Cost of goods sold450,000Selling expenses58,000Administrative expenses72,000Loss on sale of equipment5,000Income tax expense64,000Shares of common stockOutstanding at January 115,000sharesAdditional issued at May 17,000sharesAdditional issued at November 12,000shares

Find earnings per share of common stock

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Income Statement for the year ended
Particulars	Amount $	Amount $
Revenues
Sales	745,000.00
Total Revenues		745,000.00
Cost of goods sold		450,000.00
Gross Profit		295,000.00
Expenses
Selling expense	58,000.00
Administrative Expense	72,000.00
Loss on sale of equipment	5,000.00
Total Expense		135,000.00
Income before tax		160,000.00
Tax expense		64,000.00
Net Income		96,000.00

Calculation of weighted average number of shares
Issued on	Number of shares	Number of Months outstanding	Weighted number of shares
Outstanding at January 1	115,000.00	12.00	1,380,000.00
Issued at May	17,000.00	8.00	136,000.00
Issued at November	12,000.00	2.00	24,000.00
Total	144,000.00		1,540,000.00
Weighted average number of shares			128,333.33
(1,540,0000/12)

Earnings per share of common stock	0.75
(Net Income/Weighted average number of shares)

ekkarill92 answered 11 months ago

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