Sparrow Company had net income of $63,000.The company had 9,000 weighted average common shares outstanding.The basic earnings per share equal $7.00 per share.

Question

Quizplus · Accepted Answer

The basic earnings per share can be calculated by dividing the net income by the weighted average number of common shares outstanding.

Basic earnings per share = Net income / Weighted average common shares outstanding

Basic earnings per share = $63,000 / 9,000 = $7.00 per share

Therefore, the statement is true.

Sparrow Company Had Net Income of $63,000