# How to Figure Sales on Income Statement With Total Shares Outstanding & Earnings Per Share

by Bryan Keythman

The amount of a company's sales on its income statement is the amount of money the company generates from selling its products or services before paying any expenses. Net income, which equals sales minus expenses, is the amount of the company's profit at the end of an accounting period. Earnings per share (EPS) is the amount of net income the company has per share of stock outstanding. You can calculate a company's sales using EPS, total shares outstanding and other information from the income statement.

1. Find a company's EPS, listed at the bottom of its income statement, and find its total shares outstanding in the "Stockholders' Equity" section of its balance sheet. You can find a public company's financial statements in its quarterly and annual reports, which can be downloaded from the "investor relations" section of its website.

2. Multiply EPS by total shares outstanding to calculate net income. For example, if a company has \$1 EPS and 50,000 shares outstanding, multiply \$1 by 50,000 to get \$50,000 in net income.

3. Find the "Total Operating Expenses" line item and its amount on the income statement. Find the amount of any other expenses listed separately from total operating expenses, such as cost of goods sold, tax expense and interest expense.

4. Add together the total operating expenses and other expenses listed on the income statement to calculate the company's total expenses. For example, if the company's income statement shows \$100,000 in total operating expenses, \$50,000 in cost of goods sold, \$20,000 in tax expense and \$10,000 in interest expense, add these amounts to get \$180,000 in total expenses.

5. Add the company's total expenses to its net income to calculate its sales. Continuing the example, add \$50,000 in net income to \$180,000 in total expenses to get \$230,000 in sales.

#### Tip

• Monitor a company's sales over several or more accounting periods. An increasing amount of sales suggests the company is growing and gaining new customers.