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The Following Income Statement Was Reported by Snappy Seacraft Company

Question 60

Multiple Choice

The following income statement was reported by Snappy Seacraft Company for the year ending December 31, 2017:
 Sales $85,000 Rent revenue 23,000 Interest income 7,000 Total revenues $115,000 Cost of goods sold $52,000 Operating expenses 24,000 Interest expense 12,000 Loss on sale of fixed asset 6,000 Total expenses 94,000 Income from continuing operations (before tax)  $21,000 Less: Income tax 10,000 Income from continuing operations $11,000 Income from disposed segment (net of tax)  3,000 Gain on sale of disposed segment (net of tax)  2,000 Net income $16,000\begin{array}{|l|r|r|}\hline \text { Sales } & \$ 85,000 & \\\hline \text { Rent revenue } & 23,000 & \\\hline \text { Interest income } & 7,000 & \\\hline \text { Total revenues } & & \$ 115,000 \\\hline \text { Cost of goods sold } & \$52,000& \\\hline \text { Operating expenses } & 24,000& \\\hline \text { Interest expense } &12,000 & \\\hline \text { Loss on sale of fixed asset } & 6,000 & \\\hline \text { Total expenses } & &94,000 \\\hline \text { Income from continuing operations (before tax) } &&\$ 21,000 \\\hline \text { Less: Income tax } & & 10,000\\\hline \text { Income from continuing operations } & &\$ 11,000 \\\hline \text { Income from disposed segment (net of tax) } & & 3,000\\\hline \text { Gain on sale of disposed segment (net of tax) } & & 2,000 \\\hline \text { Net income } & &\$ 16,000 \\\hline & & \\\hline & & \\\hline\end{array}
Assume Snappy has an average of 15,000 shares of common stock outstanding during 2017. Based on this information, what amount of earnings per share would be reported on the income statement for the disposal of the business segment?


A) $0.33
B) $0.20
C) $1.00
D) $0.73

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