Question

Murray Company reports net income of $893,000 for the year. It has no preferred stock, and...

Murray Company reports net income of $893,000 for the year. It has no preferred stock, and its weighted-average common shares outstanding is 380,000 shares.
  
Compute its basic earnings per share.

Murray Company reports net income of $893,000 for the year. It has no preferred stock, and its weighted-average common shares outstanding is 380,000 shares.
  
Compute its basic earnings per share.

Basic Earnings Per Share
Choose Numerator: / Choose Denominator: = Basic EPS
– / = Basic EPS
– / = per share
Business   Accounting   
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Homework Answers

Answer #1

In the given case we need to calculate the basic earnings per share

Basic earnings per share = net income ÷ weighted average common shares outstanding

The given information,

Net income = $893000

Weighted average common shares outstanding = 380000 shares

Basic earnings per share = $893000 ÷ 380000 = $2.35 per share

Computation of basic earnings per share :-

Numerator (net income) (A) denominator (weighted average common shares outstanding) (B) basic earnings per share (A÷B)
$893000 380000 shares $2.35
$893000 380000 shares $2.35

These are all the information required to solve the above given question.

if there is any clarification required regarding the above provided answer, please mention them in comment box.

I hope, all the above mentioned information and explanations are useful and helpful to you.

Thank you.

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