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Compute the earnings per share of common stock under the following independent situations (Round to two decimals). (a) The dividend to preferred stockholders was declared. There has been no change in the number of shares of common stock outstanding during the year. (b) The dividend to preferred stockholders was not declared. The preferred stock is cumulative. Millwood held 10,000 shares of common treasury stock throughout the year.

Compute the earnings per share of common stock under the following independent situations (Round to two decimals). (a) The dividend to preferred stockholders was declared. There has been no change in the number of shares of common stock outstanding during the year. (b) The dividend to preferred stockholders was not declared. The preferred stock is cumulative. Millwood held 10,000 shares of common treasury stock throughout the year.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Situation B 1 Perferred share outstanding 2,000 Par value $100 Preferred dividend rate 9% Total Preferred dividend $18,000 Net income $2,50,000 Total Preferred dividend $18,000 Income avaliable to common stock holder 2,32,000 Number of common shares outstanding 88,000 Earnings per share $2.64
Transcribed Image Text:Situation B 1 Perferred share outstanding 2,000 Par value $100 Preferred dividend rate 9% Total Preferred dividend $18,000 Net income $2,50,000 Total Preferred dividend $18,000 Income avaliable to common stock holder 2,32,000 Number of common shares outstanding 88,000 Earnings per share $2.64
E14.17 Compute earnings per share under different assumptions At December 31, 2020, Millwood Corporation has 2,000 shares of S100 par value, 8% preferred stock outstanding and 100,000 shares of $10 par value common stock issued. Millwood's net income for the year is $241,000. Instructions Compute the earnings per share of common stock under the following independent situations (Round to two decimals). (a) The dividend to preferred stockholders was declared. There has been no change in the number of shares of common stock outstanding during the year. (b) The dividend to preferred stockholders was not declared. The preferred stock is cumulative. Millwood held 10,000 shares of common treasury stock throughout the year. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?". (a) Preferred shares outstanding 2,000 Par Value $100 Preferred dividend rate 8% Total preferred dividends $16,000 Net income 2,41,000 Less: total preferred dividends $16,000 Income available to common stockholders 2,25,000 Number of common shares outstanding Earnings per share 1.00.000 $2.25 (b) Preferred shares outstanding 2,000 Par Value $100 Preferred dividend rate 8% Total preferred dividends $16.000 Net income 2,41,000 Less: total preferred dividends $16,000 Income available to common stockholders 2.25.000 Number of common shares outstanding 90.000 Earnings per share $2.50 After you have completed the requirements of E14.7, consider the additional question. Answers are on the other tab 1 this: Suppose dividend rate on preferred shares changed to 9%, number of treasury shares changed to 12,000, and net income changed to $250,000. Recalculate earnings per share.
Transcribed Image Text:E14.17 Compute earnings per share under different assumptions At December 31, 2020, Millwood Corporation has 2,000 shares of S100 par value, 8% preferred stock outstanding and 100,000 shares of $10 par value common stock issued. Millwood's net income for the year is $241,000. Instructions Compute the earnings per share of common stock under the following independent situations (Round to two decimals). (a) The dividend to preferred stockholders was declared. There has been no change in the number of shares of common stock outstanding during the year. (b) The dividend to preferred stockholders was not declared. The preferred stock is cumulative. Millwood held 10,000 shares of common treasury stock throughout the year. NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?". (a) Preferred shares outstanding 2,000 Par Value $100 Preferred dividend rate 8% Total preferred dividends $16,000 Net income 2,41,000 Less: total preferred dividends $16,000 Income available to common stockholders 2,25,000 Number of common shares outstanding Earnings per share 1.00.000 $2.25 (b) Preferred shares outstanding 2,000 Par Value $100 Preferred dividend rate 8% Total preferred dividends $16.000 Net income 2,41,000 Less: total preferred dividends $16,000 Income available to common stockholders 2.25.000 Number of common shares outstanding 90.000 Earnings per share $2.50 After you have completed the requirements of E14.7, consider the additional question. Answers are on the other tab 1 this: Suppose dividend rate on preferred shares changed to 9%, number of treasury shares changed to 12,000, and net income changed to $250,000. Recalculate earnings per share.
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