Question 28 3.03 pts The formula for determining earnings per share on common st

Question

Question 28 3.03 pts The formula for determining earnings per share on common stock is Net Income Preferred Dividends/Shares of Common Stock Outstanding. Assume that the Net Income for Shine, Inc. for the Year Ended December 31, 2011, is $245,000 and that the preferred dividend is $1,600. Using the information given in the partial Balance Sheet below, what is the earning per share for Shine, Inc. for the Year Ended December 31, 2011? STOCKHOLDERS' EQUITY S 32,000 Preferred stock, 5% S100 par Common stock $10 par Retained earnings Total stockholders' equity 270,000 351,000 S 653.000 $.91 $3.15 $9.01 $10.01

Explanation / Answer

Calculate EPS :

EPS = (Net income-Preferred dividend)/Share outstanding

= (245000-1600)/27000

EPS = $9.01

so answer is c) $9.01

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