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Suppose the following information is available for Callaway Golf Company for the years 2022 and 2021....

Suppose the following information is available for Callaway Golf Company for the years 2022 and 2021. (Dollars are in thousands, except share information.) 2022 2021 Net sales $ 1,110,000 $ 1,116,000 Net income (loss) 83,310 62,713 Total assets 855,338 838,078 Share information Shares outstanding at year-end 68,500,000 70,350,000 Preferred dividends 0 0 There were 77,210,000 shares outstanding at the end of 2020. (a) What was the company’s earnings per share for each year? (Round answers to 2 decimal places, e.g. 15.25.)

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Answer #1

Company’s earnings per share for the year 2022

Earnings per share = Net Income available to common stockholders / Average number of shares outstanding

= [Net Income – Preferred Dividends] / Average number of shares outstanding

= [$83,310,000 - $0] / [(68,500,000 Shares + 70,350,000 Shares)/2]

= $83,310,000 / 69,425,000 Shares

= $1.20 per share

Company’s earnings per share for the year 2021

Earnings per share = Net Income available to common stockholders / Average number of shares outstanding

= [Net Income – Preferred Dividends] / Average number of shares outstanding

= [$62,713,000 - $0] / [(70,350,000 Shares + 77,210,000 Shares)/2]

= $62,713,000 / 73,780,000 Shares

= $0.85 per share

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