A Company Had 30,000 Shares of Common Stock Outstanding on January

question 107

Multiple Choice

A company had 30,000 shares of common stock outstanding on January 1, 2010. An additional 10,000 shares were sold and issued on June 1 and 20,000 more were sold and issued on December 1. Pre-tax income for the year was $320,000. The income tax rate was 40 percent. Earnings per share were:

• A) $3.33.
• B) $6.67.
• C) $4.00.
• D) $3.20.

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Definitions:

Recessive Alleles

Genetic variants that must be inherited from both parents to be expressed in the offspring; not expressed when a dominant allele is present.

Genetic Drift

Genetic drift refers to random fluctuations in the frequencies of alleles (variant forms of a gene) within a population, which can lead to the increase or decrease in certain traits over time.

Natural Selection

The process in which organisms better adapted to their environment tend to survive and produce more offspring, leading to the gradual evolution of species.

Molecular Variation

Differences at the molecular level among individuals, which can include variations in DNA sequences, genes, and proteins.