Ecker Company reports $1,550,000 of net income for 2017 and declares $217,000 of

Q: Ecker Company reports $1,550,000 of net income for 2017 and declares $217,000 of

1. Net income available to common Stockholders = Net Income – Preference dividend = $1,550,000 - $217,000 Net income available to common Stockholders =$1,333,000 2. EPS = Net income available to common Stockholders / No of Common Shares = $1,333,000 / 400,000 Shares EPS = 3.3325

ID: 2580987 • Letter: E

Question

Ecker Company reports $1,550,000 of net income for 2017 and declares $217,000 of cash dividends on its preferred stock for 2017. At the end of 2017, the company had 400,000 weighted-average shares of common stock 1. What amount of net income is available to common stockholders for 2017? Net income To preferred stockholders Net income available to common stockholders 2. What is the company's basic EPS for 2017? Basic Earnings per Share Choose Numerator: Choose Denominator Basic Earnings per Share Net income available to common stockholders Weighted-average outstanding shares Basic earnings per share

Explanation / Answer

Net income available to common Stockholders = Net Income – Preference dividend

= $1,550,000 - $217,000

Net income available to common Stockholders =$1,333,000

EPS = Net income available to common Stockholders / No of Common Shares

= $1,333,000 / 400,000 Shares

EPS = 3.3325

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Ecker Company reports $1,550,000 of net income for 2017 and declares $217,000 of

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