In: Accounting
Exercise 4-13
At December 31, 2016, Culver Corporation had the following stock outstanding.
10% cumulative preferred stock, $100 par, 108,612 shares | $10,861,200 | |
Common stock, $5 par, 4,060,980 shares | 20,304,900 |
During 2017, Culver did not issue any additional common stock. The
following also occurred during 2017.
Income from continuing operations before taxes | $24,647,300 | ||
Discontinued operations (loss before taxes) | $3,285,900 | ||
Preferred dividends declared | $1,086,120 | ||
Common dividends declared | $2,248,400 | ||
Effective tax rate | 35 | % |
Compute earnings per share data as it should appear in the 2017
income statement of Culver Corporation. (Round answers
to 2 decimal places, e.g. 1.48.)
Net income
Income before income tax $24,647,300
Income tax (35% X $24,647,300) 86,26,555
Income from continuing operations 1,60,20,745
Discontinued operations
Loss before income tax $3,285,900
Less: Applicable income tax (35%) 11,50,065 (21,35,835)
Net income 1,38,84,910
Preference dividends declared: 10,86,120
Weighted average shares outstanding 40,60,980
Earnings per share
Income from continuing operations $3.68*
Discontinued operations, net of tax (0.53)**
Net income $3.15***
*(1,60,20,745 – 10,86,120) ÷ 40,60,980
**21,35,835 / 40,60,980
***(1,38,84,910 - 10,86,120) ÷ 40,60,980