The Wall Street Journal routinely publishes summaries of corporate quarterly and annual earnings reports in a feature called the "Earnings Digest." A typical "digest" report takes the following form.

(a) Includes a net charge of $26,000,000 from loss on the sale of electrical equipment(b) Extraordinary gain on Middle East property expropriationThe letter in parentheses following the company name indicates the exchange on which Energy Enterprises' stock is traded? in this case, the American Stock Exchange.

InstructionsAnswer the following questions.(a) How was the loss on the electrical equipment reported on the income statement?Was it reported in the fourth quarter of 2011? How can you tell?(b) Why did the Wall Street Journal list the extraordinary item separately?(c) What is the extraordinary item? Was it included in income for the fourth quarter?How can you tell?(d) Did Energy Enterprises have an operating loss in any quarter of 2011? of 2012? How do you know?(e) Approximately how many shares of stock were outstanding in 2012? Did the number of outstanding shares change from July 31, 2011 to July 31, 2012?(f) As an investor, what numbers should you use to determine Energy Enterprises' profit margin ratio? Calculate the profit margin ratio for 2011 and 2012 that you consider most useful. Explain your decision.

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ENERGY ENTERPRISES (A) Quarter ending July 31 2011 2012 $2,049,000,000 97,000,000 Revenues $1,754,000,000 (a) 68,750,000 0.93 Net income EPS: Net income 1.28 12 months ending July 31 2011 2012 $5,578,500,000 (b) 1,900,000 $5,065,300,000 Revenues Extraordinary item (a) 33,250,000 0.48 Net income 102,700,000 1.36 EPS: Net income