The company would have EPS of $3.50 for Year 8 and also its retained earnings for Year 8 would be $20 million However, retained earnings is not $10 million.
The company would have Year 8 EPS of $3.50 and Year 9 retained earnings of $10 million. The company’s earnings per share would equal $2.00 (net income of $35 million less dividend payments of $15 million = $20 million divided by 10 million shares).ĮPS is calculated before dividends are paid out. Incorrect as annual interests costs are taken into account for the net profit calculation. The company’s retained earnings for Year 8 would be $5 million (net income of $35 million less dividend payments of $15 million less $15 million in interest payments) and its Year 8 EPS would be $0.50. Incorrect as retained earnings is after the share and the interest costs are paid out. The company’s retained earnings for Year 8 would be $35 million. If a company earns net income of $35 million in Year 8, has 10 million shares of stock, pays a dividend of $1.50 per share, and has annual interest costs of $15 million, then
Glo-Bus Quiz 2 is an exceptionally challenging quiz unless you have a firm grasp of all of the formulas and how they interact in the game itself.
