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    EPS using tax rate and expenses

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    Use the information for Sports Baseballs, Inc.

    Sports Baseballs, Inc. is a corporation that manufacturers and sells baseballs across several states in the Southeast. It had sales of $2.7 million during the last year. Expenses were as follows:

    Cost of goods sold............................... $1.2 million
    Administrative expenses........................ $250,000
    Marketing and selling expenses............... $175,000
    Depreciation........................................ $500,000
    Interest expense.................................. $200,000
    Dividends paid..................................... $150,000

    Suppose that Sports Baseball has 30,000 shares of stock. Assume a tax rate of 30%. What is the EPS figure?

    © BrainMass Inc. brainmass.com June 4, 2020, 12:39 am ad1c9bdddf
    https://brainmass.com/business/accounting/eps-tax-rate-expenses-351695

    Solution Preview

    EPS = Net Income/Number of shares

    Net Income is
    Total sales = 2,700,000
    Total expense
    Cost of goods sold............................... $1.2 million ...

    Solution Summary

    The solution explains how to calculate the earnings per share using a very brief calculation.

    $2.19

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