In: Accounting
Sunland Inc. presented the following data.
Net income | $2,680,000 | |
Preferred stock: 48,000 shares outstanding, $100 par, 8% cumulative, not convertible | 4,800,000 | |
Common stock: Shares outstanding 1/1 | 729,600 | |
Issued for cash, 5/1 | 273,600 | |
Acquired treasury stock for cash, 8/1 | 160,800 | |
2-for-1 stock split, 10/1 |
Compute earnings per share. (Round answer to 2 decimal
places, e.g. $2.55.)
Earnings per share |
$enter earnings per share rounded to 2 decimal places |
Answer | |||
Net Income |
$ 2,680,000 | ||
Less: | Preferred Dividend | $ 384,000 | (48000 x $ 100 x 8%) |
Earning for Common Stockholders | $ 2,296,000 | ||
No. of Common Stock outstanding | 1,684,800 | (Workings) | |
Earnings per share | 1.36 | ||
Computation of Common Stock outstanding | |||
Beginning outstanding | 729,600 | ||
Add: | Issued | 273,600 | |
Less: | Acquired treasury stock | 160,800 | |
Outstanding before stock split | 842,400 | ||
Outstanding after stock split | 1,684,800 | (842400 x 2) | |