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MCS,PHD
Argosy University/ Phoniex University/
Nov-2005 - Oct-2011
Professor
Phoniex University
Oct-2001 - Nov-2016
E11-26B (Learning Objectives 1, 4: Prepare an income statement; compute earnings per share; evaluate a company as an investment) The Bergeron Book Company’s accounting records include the following for 2012 (in thousands):
Â
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 |
 |
|
Other      revenues  ............................................................................. |
$Â Â Â 1,500 |
|
Income tax expense—extraordinary gain ..................................... |
640 |
|
Income tax expense—income from continuing operations............ |
4,920 |
|
Extraordinary     gain  ....................................................................... |
1,600 |
|
Sales       revenue  ................................................................................ |
108,000 |
|
Total  operating  expenses.............................................................. |
97,200 |
|
 |
 |
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1. Prepare Bergeron Book’s single-step income statement for the year ended December 31, 2012, including EPS. Bergeron Book had 800 thousand shares of common stock and no preferred stock outstanding during the year.
2. Assume investors capitalize Bergeron Book earnings from continuing operations at 8%. Estimate the price of one share of the company’s stock.
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