Kim Has Gathered the Following Information on a Company

question 72

Multiple Choice

Kim has gathered the following information on a company. What is the amount of the earnings per share?

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

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Definitions:

Cost of Goods Sold

The direct costs attributable to the production of the goods sold by a company, including materials and labor.

Absorption Costing

An accounting method that includes all manufacturing costs—direct materials, direct labor, and both variable and fixed manufacturing overhead—in the cost of a product.

Fixed Costs

Expenses that do not change in proportion to the activity of a business, such as rent, salaries, and equipment costs.

Net Income

The net income of a business following the deduction of all costs and taxes from its earnings.