If Net Income Is $10,000 and There Were 8,000 Common

question 71

Multiple Choice

If net income is $10,000 and there were 8,000 common shares issued and outstanding the entire year, and $100,000 of noncumulative, nonconvertible 6% $100 par preferred shares outstanding the entire year, what is EPS if no dividends were declared during the year?

• A)$0.50
• B)$1.25
• C)$2.00
• D)$1.00

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Definitions:

Implied Warranty

A legal term referring to the assurances that a product will perform as expected, even though not explicitly stated by the seller.

Fitness

A state of health and well-being, often achieved through regular physical activity, proper nutrition, and adequate rest.

Suitable Goods

Products that meet a buyer's requirements and are fit for the intended purpose, adhering to descriptions or samples shown at the time of sale.

Express Warranty

A written or spoken promise from a seller regarding the quality, functionality, or condition of a product.