Consider the following facts: - Company A had 10,380 common stock shares outstan

Question

Consider the following facts: - Company A had 10,380 common stock shares outstanding at the beginning of 2015. - On June 1, 2015, it repurchased 6,000 of its common shares. - For the year ending 2015, it had a net loss of $180,000. - In 2015, it declared and paid cash dividends of $24,000 to its common shareholders. - In 2015, it declared and paid cash dividends of $28,000 to its preferred shareholders. Based on this information, its earnings per share for 2015 was: ($30.23) ($22.10) ($18.60) ($33.72) None of these answers are correct

Explanation / Answer

As per my undetstanding, dividends to common shareholders should not be considered for calculation EPS

EPS= Net income - preferred Dividends number of common shares outstanding = 180000-28000 7825 = $ (26.58) Shares outstanding at end as follows Date Shares issued months Shares Outstanding Beginning 10380 5/12 4325 01/06/2015 6000 7/12 3500 At end 7825

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