Kim Has Gathered the Following Information on a Company What Is the Amount of the Earnings Per Share?
A)

question 49

Multiple Choice

Kim has gathered the following information on a company. $$\begin{array} { l l } \hline \text { Sales } & \$ 640,000 \\\text { Dividends paid on } & \$ 18,000 \\\text { ordinary share } & \\\text { Net profit margin }&5 \% \\\text { Number of shares } &128,000\\\text { outstanding }\\\hline\end{array}$$ What is the amount of the earnings per share?

• A) $0.28
• B) $0.30
• C) $0.14
• D) $0.25

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Definitions:

Income Statement

A financial statement that shows a company's revenues, expenses, and profits over a specific period.

Unit Product Cost

The total cost to produce one unit of a product, including direct materials, direct labor, and manufacturing overhead.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period, highlighting net profit or loss.

Variable Costing

An accounting method that only considers variable costs (costs that vary with production volume) in determining product costs and profitability.