For the year ended December 31, Southern Supply had net sales of $3,875,000, costs and other expenses (including income tax) of $3,100,000, and a gain from discontinued operations (net of income tax) of $210,000.

1. To the extent possible from the limited information provided, make a condensed income statement (including earnings per share), assuming that 620,000 shares of common stock were outstanding throughout the year. (A condensed income statement is illustrated inExhibit 12-2.)
2. Which earnings per share figure would you recommend be used to compute the price-earnings ratio for Southern Supply?Explain briefly.