Presented Below Are Performance Measure Data from the Income Statement

question 15

Essay

Presented below are performance measure data from the income statement of Wheezer Company.
Gross Profit $2,345,000
Operating Income 1,987,000
Income from Continuing Operations before Taxes 1,776,000
Income from Continuing Operations 1,234,000
Net Income 1,486,000
Wheezer has 200,000 shares of common stock outstanding. Prepare the summary schedule of earnings per share required by U.S. GAAP.

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Definitions:

Unit Product Cost

The total cost (both direct and indirect) allocated to a single unit of product, used in setting prices and assessing profitability.

Variable Costing

A method of inventory costing that includes only variable production costs (materials, labor, and variable overhead) in the cost of goods sold, treating fixed overhead as a period expense.

Net Operating Income

The profit a company makes after deducting operating expenses like wages, depreciation, and cost of goods sold, but before interest and taxes.

Operating Loss

A situation where a company's operating expenses exceed its gross profits or revenues, indicating that it is not making money from its core operations.