A company had 125,000 shares of common stock outstanding on January 1 and then sold 35,000 additional shares on March 30.Net income for the year was $594,750.What are earnings per share?

Question

Quizplus · Accepted Answer

To calculate earnings per share, we first need to find the total number of shares outstanding.

125,000 shares outstanding on January 1 + 35,000 shares sold on March 30 = 160,000 total shares outstanding

Next, we can calculate earnings per share:

Earnings per share = Net income / Total shares outstanding

Earnings per share = $594,750 / 160,000

Earnings per share = $3.93

Therefore, the answer is (C) $3.93.

A Company Had 125,000 Shares of Common Stock Outstanding on January