Question 1 Assume a company has 10 million shares of stock outstanding and that

Question

Question 1 Assume a company has 10 million shares of stock outstanding and that its Income Statement for Year 12 is as follows Year 12 ncome Statement Data Net Revenues from Footwear Sales Cost of Pairs Sold Warehouse Expenses Marketing Expenses Administrative Expenses Operating Profit (Loss) Interest Income (expenses) Pre-tax Profit (Loss) Income Taxes Net Profit (Loss) in 000s) 320,000 200,000 17,000 45,000 8,000 50,000 (10,000) 40,000 12,000 S 28,000 Based on the above income statement data, the company's operating profit margin and EPS are 8.75% and $2 80. 15 6% and $5 00 15 6% and $2 80. 12.5% and S5 00 15.6% and $4 00 ch

Explanation / Answer

Operating Profit Margin = (Operating Profit / Sales) x 100 = ($50,000,000 / $320,000,000) x 100 = 15.6%

Earning per share (EPS) = Net Profit / No. of shares = $28,000,000 / 10,000,000 = $2.80 (Third option is correct)

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.