Q13: At January 1, 2013, Foxmore Company had 80,000 shares of common stock outst

Question

Q13: At January 1, 2013, Foxmore Company had 80,000 shares of common stock outstanding and no preferred stock. During the year they issued 40,000 additional shares of common stock. At December 31, 2013, Foxmore had 120,000 shares of common stock outstanding, and no preferred stock. In addition, Foxmore reported the following results for the year 2013: Sales revenues from regular business operations $3,000,000 Cost of goods sold 900,000 Operating expenses from their regular business operations 600,000 Gain on disposal of several items of property, plant & equipment 15,000 Income tax expense on continuing operations 330,000 Loss on the termination of a discontinued business segment, net of tax 120,000 Losses on damage caused by earthquake, net of tax 280,000 Please prepare earnings per share information in the following format. (Round all amounts to nearest cent.) Earnings per share Income (loss) from continuing operations Income (loss) from discontinued operations Income (loss) before extraordinary items Extraordinary loss Net income (loss)

Explanation / Answer

Earnings per share;

Income from continuing operation=1185000/120000=9.875 per share

Loss from discontinue operation =120000/120000=1.00 per share

Income before extraordinary item =1065000/120000=8.875 per share

Extraordinary loss=280000/120000=2.33 per share

Net income=785000/120000=6.542 per share

Sales revenue 3000000 Less cost of good sold 900000 -operating expenses 600000 Income from operation 1500000 Other revenue and gain; +Gain on disposal of property ,plant and equipment 15000 Income from continuing operation before income tax 1515000 -income tax 330000 Income from continuing operation 1185000 Discontinue operation; -Loss on discontinue operation(net of tax) 120000 Income before extraordinary item 1065000 Extraordinary item; -Loss due to earthquake 280000 Net income 785000

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