Novak Inc. Income Statement For the Year Ended December 31 Income From Continuing Operations Loss From Discontinued Operations Net Income/(Loss) $ A portion of the combined statement of income and retained earnings of Novak Inc. for the current year follows. Income before extraordinary item Loss from discontinued operations, net of applicable income tax (Note 1) Net income Retained earnings at the beginning of the year Dividends declared: On preferred stock-$6.00 per share On common stock-$1.75 per share $15,040,000 1,370,000 13,670,000 82,490,000 96,160,000 $294,000 15,080,000 15,374,000 $80,786,000 Retained earnings at the end of the year Note 1. During the year, Novak Inc. suffered a major loss from discontinued operations of $1,370,000 after applicable income tax reduction of $1,170,000. At the end of the current year, Novak Inc. has outstanding 8,380,000 shares of $10 par common stock and 49,000 shares of 6% preferred. On April 1 of the current year, Novak Inc. issued 990,000 shares of common stock for $30 per share to help finance the loss from discontinued operations. Compute the earnings per share on common stock for the current year as it should be reported to stockholders. (Round answer to 2 decimal places, eg. $2.55.)
Novak Inc. Income Statement For the Year Ended December 31 Income From Continuing Operations Loss From Discontinued Operations Net Income/(Loss) $ A portion of the combined statement of income and retained earnings of Novak Inc. for the current year follows. Income before extraordinary item Loss from discontinued operations, net of applicable income tax (Note 1) Net income Retained earnings at the beginning of the year Dividends declared: On preferred stock-$6.00 per share On common stock-$1.75 per share $15,040,000 1,370,000 13,670,000 82,490,000 96,160,000 $294,000 15,080,000 15,374,000 $80,786,000 Retained earnings at the end of the year Note 1. During the year, Novak Inc. suffered a major loss from discontinued operations of $1,370,000 after applicable income tax reduction of $1,170,000. At the end of the current year, Novak Inc. has outstanding 8,380,000 shares of $10 par common stock and 49,000 shares of 6% preferred. On April 1 of the current year, Novak Inc. issued 990,000 shares of common stock for $30 per share to help finance the loss from discontinued operations. Compute the earnings per share on common stock for the current year as it should be reported to stockholders. (Round answer to 2 decimal places, eg. $2.55.)
Practical Management Science
6th Edition
ISBN:9781337406659
Author:WINSTON, Wayne L.
Publisher:WINSTON, Wayne L.
Chapter2: Introduction To Spreadsheet Modeling
Section: Chapter Questions
Problem 20P: Julie James is opening a lemonade stand. She believes the fixed cost per week of running the stand...
Related questions
Question
Transcribed Image Text:Novak Inc.
Income Statement
For the Year Ended December 31
Income From Continuing Operations
Loss From Discontinued Operations
Net Income/(Loss)
$
Transcribed Image Text:A portion of the combined statement of income and retained earnings of Novak Inc. for the current year follows.
Income before extraordinary item
Loss from discontinued operations, net of applicable income tax (Note 1)
Net income
Retained earnings at the beginning of the year
Dividends declared:
On preferred stock-$6.00 per share
On common stock-$1.75 per share
$15,040,000
1,370,000
13,670,000
82,490,000
96,160,000
$294,000
15,080,000
15,374,000
$80,786,000
Retained earnings at the end of the year
Note 1. During the year, Novak Inc. suffered a major loss from discontinued operations of $1,370,000 after applicable income tax
reduction of $1,170,000.
At the end of the current year, Novak Inc. has outstanding 8,380,000 shares of $10 par common stock and 49,000 shares of 6%
preferred. On April 1 of the current year, Novak Inc. issued 990,000 shares of common stock for $30 per share to help finance the
loss from discontinued operations.
Compute the earnings per share on common stock for the current year as it should be reported to stockholders. (Round answer to 2
decimal places, eg. $2.55.)
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 2 steps
Recommended textbooks for you
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Practical Management Science
Operations Management
ISBN:
9781337406659
Author:
WINSTON, Wayne L.
Publisher:
Cengage,
Operations Management
Operations Management
ISBN:
9781259667473
Author:
William J Stevenson
Publisher:
McGraw-Hill Education
Operations and Supply Chain Management (Mcgraw-hi…
Operations Management
ISBN:
9781259666100
Author:
F. Robert Jacobs, Richard B Chase
Publisher:
McGraw-Hill Education
Purchasing and Supply Chain Management
Operations Management
ISBN:
9781285869681
Author:
Robert M. Monczka, Robert B. Handfield, Larry C. Giunipero, James L. Patterson
Publisher:
Cengage Learning
Production and Operations Analysis, Seventh Editi…
Operations Management
ISBN:
9781478623069
Author:
Steven Nahmias, Tava Lennon Olsen
Publisher:
Waveland Press, Inc.