Question
In: Accounting
he net income of Foster Furniture, Inc., amounted to $1,600,000 for the current year. a. Compute...
he net income of Foster Furniture, Inc., amounted to $1,600,000 for the current year. a. Compute the amount of earnings per share assuming that the shares of capital stock outstanding throughout the year consisted of: 1. 400,000 shares of $1 par value common stock and no preferred stock. 2. 100,000 shares of 8 percent, $100 par value, cumulative preferred stock and 300,000 shares of $5 par value common stock. b. Is the earnings per share figure computed in part a(2) considered to be basic or diluted?
Compute the amount of earnings per share assuming that the shares of capital stock outstanding throughout the year consisted of 400,000 shares of $1 par value common stock and no preferred stock. (Round your answer to 2 decimal places.
Solutions
Expert Solution
| Case a | Case b | |
| Net Income | 1,600,000 | 1,600,000 |
| Less: Preferred Dividend | - | 800,000 |
| Earnings available for Common Stockholders | 1,600,000 | 800,000 |
| Number of Common Shares | 400,000 | 300,000 |
| Earnings per Share | 4.00 | 2.67 |
| It is considered as basic earnings per share. Diluted earnings is earnings per share calculated after considering potential equity shares in future | ||
ekkarill92 answered 1 year agoRelated Solutions
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Jolie Foster Care Homes Inc. shows the following data: Year Net Income Total Assets Stockholders'...
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Stockholders'
Equity
Total Debt
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$
200,000
$
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20X3
137,000
2,120,000
1,470,000
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620,000
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year
return on assets
2011
%
2012
%
2013
%
2014
%...
Jolie Foster Care Homes Inc. shows the following data: Year Net Income Total Assets Stockholders'...
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Year
Net Income
Total
Assets
Stockholders'
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Total Debt
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$
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$
2,390,000
$
761,000
$
1,629,000
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191,000
2,700,000
966,000
1,734,000
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208,000
2,730,000
1,770,000
960,000
20X4
192,000
2,470,000
2,220,000
250,000
compute the ratio of net income to total assets for each year.
round to 2 decimal place and compute the ratio of net income to
stockholders equity for each year.
Jolie Foster Care Homes Inc. shows the following data: Year Net Income Total Assets Stockholders'...
Jolie Foster Care Homes Inc. shows the following data:
Year
Net Income
Total
Assets
Stockholders'
Equity
Total Debt
20X1
$
155,000
$
2,390,000
$
761,000
$
1,629,000
20X2
191,000
2,700,000
966,000
1,734,000
20X3
208,000
2,730,000
1,770,000
960,000
20X4
192,000
2,470,000
2,220,000
250,000
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(round to 2 decimal place)
Year Return on Assets
20X1 %
20X2 %
20X3 %
20X4 %
Compute the ratio of net income to stockholders...
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Determine Jack's minimum Net Income For Tax Purposes for the
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The net income reported on the income statement for the current
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liability accounts at the beginning and end of the year are as
follows:
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Beginning of Year
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$42,820
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33,730
31,640
Inventories
46,060
48,170
Prepaid expenses
5,180
4,070
Accounts payable (merchandise creditors)
44,090
40,510
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24,090
26,460
a. Prepare the “Cash...
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The net income reported on the income statement for the current
year was $121,600. Depreciation recorded on store equipment for the
year amounted to $20,100. Balances of the current asset and current
liability accounts at the beginning and end of the year are as
follows:
End of Year
Beginning of Year
Cash
$49,490
$45,530
Accounts receivable (net)
35,480
33,650
Inventories
48,450
51,220
Prepaid expenses
5,440
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liability accounts at the beginning and end of the year are as
follows:
End of Year
Beginning of Year
Cash
$40,180
$40,070
Accounts receivable (net)
30,070
28,060
Merchandise inventory
40,390
45,420
Prepaid expenses
3,470
4,840
Accounts payable (merchandise creditors)
38,610
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Wages payable
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Required:
A.
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$84,380 Accounts receivable (net) 101,900 104,120 Inventories
200,900 179,390 Prepaid expenses 11,170 11,900 Accounts payable
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11,730 a. Prepare...
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