A portion of the combined statement of income and retained earnings of Seminole Inc. for the current year follows.Income from continuing operations $15,000,000Loss from discontinued operations, net of applicable income tax (Note 1) 1,340,000Net income 13,660,000Retained earnings at the beginning of the year 83,250,000 96,910,000Dividends declared: 00On preferred stock—$6.00 per share$ 300,000 00On common stock—$1.75 per share14,875,000 15,175,000Retained earnings at the end of the year $81,735,000Note 1. During the year, Seminole Inc. suffered a major loss from discontinued operations of $1,340,000 after applicable income tax reduction of $1,200,000.At the end of the current year, Seminole Inc. has outstanding 8,500,000 shares of $10 par common stock and 50,000 shares of 6% preferred. On April 1 of the current year, Seminole Inc. issued 1,000,000 shares of common stock for $32 per share to help finance the loss from discontinued operations.InstructionsCompute the earnings per share on common stock for the current year as it should be reported to stockholders.

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Description: A portion of the combined statement of income and retained earnings of Seminole Inc. for the current year follows.Income from continuing operations $15,000,000Loss from discontinued operations, net of applicable income tax (Note 1) 1,340,000Net inc

Calculate net income available for common stockholders.

Answered: A portion of the combined statement of…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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A portion of the combined statement of income and retained earnings of Seminole Inc. for the current year follows.

Income from continuing operations		$15,000,000
Loss from discontinued operations, net of applicable income tax (Note 1)		1,340,000
Net income		13,660,000
Retained earnings at the beginning of the year		83,250,000
		96,910,000
Dividends declared:
00On preferred stock—$6.00 per share	$ 300,000
00On common stock—$1.75 per share	14,875,000	15,175,000
Retained earnings at the end of the year		$81,735,000
Note 1. During the year, Seminole Inc. suffered a major loss from discontinued operations of $1,340,000 after applicable income tax reduction of $1,200,000.

At the end of the current year, Seminole Inc. has outstanding 8,500,000 shares of $10 par common stock and 50,000 shares of 6% preferred. On April 1 of the current year, Seminole Inc. issued 1,000,000 shares of common stock for $32 per share to help finance the loss from discontinued operations.

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Compute the earnings per share on common stock for the current year as it should be reported to stockholders.

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