The Hooper Book Company accounting records include the following for 2016 (in thousands): Other revenues.....................................$ 1,600 Income

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The Hooper Book Company accounting records include the following for 2016 (in thousands):
Other revenues.....................................$ 1,600
Income tax expense.................................5,640
Sales revenue......................................122,000
Total operating expenses........................104,800
Requirements
1. Prepare Hooper Book Company's single-step income statement for the year ended December 31, 2016, including EPS. Hooper had 1,000,000 shares of common stock and no preferred stock outstanding during the year.
2. Assume Hooper Book Company's income from operations reflects that its core business has been steadily increasing by about 10% per year over the past three years and that none of its operations have been discontinued. What does this say about the quality of its earnings?
3. Assume investors capitalize Hooper Book Company's earnings from continuing operations at 7%. Estimate the price of one share of the company's stock.
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on...
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Related Book For  book-img-for-question

Financial Accounting

ISBN: 978-0134127620

11th edition

Authors: Walter Harrison, Charles Horngren, William Thomas, Wendy Tietz

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