Assume a company has 10 million shares of stock outstanding and that its Income

Question

Assume a company has 10 million shares of stock outstanding and that its Income Statement for Year 12 is as follows: Income Statement Data Year 12 (in 000s) Net Revenues from Footwear Sales $ 330,000 Cost of Pairs Sold 240,000 Warehouse Expenses 15,000 Marketing Expenses 35,000 Administrative Expenses 8,000 Operating Profit (Loss) 32,000 Interest Income (expenses) (10,000) Pre-tax Profit (Loss) 22,000 Income Taxes 6,600 Net Profit (Loss) $ 15,400 Based on the above income statement data, the company's operating profit margin and EPS are Select one: a. 9.70% and $1.54. b. 9.70% and $2.20. c. 6.67% and $1.54. d. 9.70% and $3.20. e. None of the above.

Explanation / Answer

Hi,

Please find the answer as follows:

Operating Profit Margin = 32000/330000*100 = 9.69% or 9.70%

EPS = Net Profit/Common Stock Outstanding = 15400000/10000000 = 1.54

Option A (9.70 and 1.54) is correct.

Thanks.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

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