substituting the values for baker corporation from its income statement table 3 4 in 681263

TABLE 3.4

Baker Corporation Income
Statement ($000) for the
Year Ended December 31,
2003

Sales revenue

$1,700

Less: Cost of goods sold

1,000

Gross profits

$700

Less: Operating expenses

Selling expense

$70

General and administrative expense

120

Lease expense^a

40

Depreciation expense

100

Total operating expense

330

Earnings before interest and taxes (EBIT)

$370

Less: Interest expense

70

Net profits before taxes

$300

Less: Taxes (rate40%)

120

Net profits after taxes

$180

Less: Preferred stock dividends

10

Earnings available for common stockholders

$170

Earnings per share (EPS)^b

$1.70