Question

Skysong Inc. presented the following data. Net income $2,350,000 Preferred stock: 52,000 shares outstanding, $100 par,...

Skysong Inc. presented the following data.

Net income $2,350,000
Preferred stock: 52,000 shares outstanding, $100 par, 9% cumulative, not convertible 5,200,000
Common stock: Shares outstanding 1/1 686,400
   Issued for cash, 5/1 270,000
   Acquired treasury stock for cash, 8/1 148,800
   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

Homework Answers

Answer #1

Particulars

Number of shares

Share outstanding

Stock Split Restatement

No. of months

Weighted-average shares

Shares outstanding

686400

686400

2 4

457600

Issued Shares

270000

956400 2 3

478200

Treasury stock 148800 807600 2

2

269200

Stock split

807600 1615200 1 3

403800

Total weighted average number of shares outstanding

1711746

Earnings per share = (Net income - Preferred dividend) /  Total weighted average number of shares outstanding

=(2350000-5200000*9%)/1711746

= $1.10 per share

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