Comparative Income Statements and Basic EPSAnoka Company reported the following selected items in the shareholders' equity section of its balance sheet on December 31, Year 3, and Year 4: December 31 Year 4Year 3Preferred stock, 7%, 100 par, nonconvertible$50,000$50,000Common stock, $10 par84,00070,000 In addition, it listed the following selected pretax items as of December 31, Year 3 and Year 4: December 31, Year 4 December 31, Year 3 DebitCredit DebitCreditSales $140,000 $124,300Income from discontinued operations — 6,000Cost of goods sold$80,000 $75,000 Operating expenses20,000 18,000 Loss from discontinued operations9,000 — The preferred shares were outstanding during all of Year 3 and Year 4; annual dividends were declared and paid in each year. During Year 3, 2,000 common shares were sold for cash on October 4. During Year 4, a 20% stock dividend was declared and issued in early May. At the end of Year 3 and Year 4, the common stock was selling for $25.75 and $32.20, respectively. The company is subject to a 30% income tax rate

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Chapter15: Financial Statement Analysis

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Comparative Income Statements and Basic EPS

Anoka Company reported the following selected items in the shareholders' equity section of its balance sheet on December 31, Year 3, and Year 4:

	Year 4	Year 3
	December 31
Preferred stock, 7%, 100 par, nonconvertible	$50,000	$50,000
Common stock, $10 par	84,000	70,000

In addition, it listed the following selected pretax items as of December 31, Year 3 and Year 4:

	Debit	Credit		Debit	Credit
	December 31, Year 4		December 31, Year 3
Sales		$140,000			$124,300
Income from discontinued operations		—			6,000
Cost of goods sold	$80,000			$75,000
Operating expenses	20,000			18,000
Loss from discontinued operations	9,000			—

The preferred shares were outstanding during all of Year 3 and Year 4; annual dividends were declared and paid in each year. During Year 3, 2,000 common shares were sold for cash on October 4. During Year 4, a 20% stock dividend was declared and issued in early May. At the end of Year 3 and Year 4, the common stock was selling for $25.75 and $32.20, respectively. The company is subject to a 30% income tax rate

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