Elite Trailer Parks has an operating profit of $285,000. Interest expense for th
ID: 2740775 • Letter: E
Question
Elite Trailer Parks has an operating profit of $285,000. Interest expense for the year was $30,500; preferred dividends paid were $28,900; and common dividends paid were $36,800. The tax was $68,500. The firm has 21,600 shares of common stock outstanding.
Calculate the earnings per share and the common dividends per share for Elite Trailer Parks. (Round your answers to 2 decimal places.)
What was the increase in retained earnings for the year?
a.Calculate the earnings per share and the common dividends per share for Elite Trailer Parks. (Round your answers to 2 decimal places.)
Earnings per share $ Common dividends per share $
b.
What was the increase in retained earnings for the year?
Increase in retained earnings $Explanation / Answer
Operating profit $ 285,000 Less: Interest $ 30,500 Profit before tax $ 254,500 Less: Tax $ 68,500 Profit after tax $ 186,000 Less: Dividends paid to preference stockholders $ 28,900 Less: Dividends paid to common stockholders $ 36,800 Increase in retained earnings $ 120,300 Eanings per share $ 7.27 (186000-28900)/21600 Common dividend per share $ 1.70 36800/21600
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