Question

Comparative Statements of Shareholders’ Equity for Locke Intertechnology Corporation were reported as follows for the fiscal years ending December 31, 2014, 2015, and 2016.

LOCKE INTERTECHNOLOGY CORPORATION
Statements of Shareholders' Equity
For the Years Ended Dec. 31, 2014, 2015, and 2016
($ in millions)
	Preferred Stock, $10 par		Common Stock, $1 par			Additional Paid-in Capital			Retained Earnings			Total Shareholders' Equity
Balance at January 1, 2014			$	65		$	515		$	1,886		$	2,466
Sale of preferred shares	9						450						459
Sale of common shares, 7/1				8			78						86
Cash dividend, preferred										(1	)		(1	)
Cash dividend, common										(15	)		(15	)
Net income										280			280
Balance at December 31, 2014	9			73			1,043			2,150			3,275
Retirement of common shares, 4/1				(6	)		(33	)		(18	)		(57	)
Cash dividend, preferred										(1	)		(1	)
Cash dividend, common										(19	)		(19	)
3-for-2 split effected in the form of        a common stock dividend, 8/12				33.5			(33.5	)
Net income										380			380
Balance at December 31, 2015	9			100.5			976			2,492			3,578
10% common stock dividend, 5/1				10.05			110			(120.05	)
Sale of common shares, 9/1				3			35						38
Cash dividend, preferred										(3	)		(3	)
Cash dividend, common										(26	)		(26	)
Net income										420			420
Balance at December 31, 2016	9		$	113.55		$	1,121.5		$	2,762.95		$	4,007

Required:

Infer from the statements the events and transactions that affected Locke Intertechnology Corporation's shareholders' equity and compute earnings per share as it would have appeared on the income statements for the years ended December 31, 2014, 2015, and 2016. No potential common shares were outstanding during any of the periods shown. (Enter your answers in millions rounded to 2 decimal places (i.e., 5,500,000 should be entered as 5.50).)

Answer 1

	2014	2015	2016
Net Income	280.00	380.00	420.00
Dividend	15.00	19.00	26.00
Profit Available for Equity Share Holders	295.00	399.00	446.00
Average Number of Shares	44	45.66667	49.44231
EPS	6.70	8.74	9.02

Note: EPS= Profit Available for Equity Share Holders / Number of Shares