Effect of Financing on Earnings per Share Henriksen Co., which produces and sells biking equipment, is financed as follows: Bonds payable, 10% (issued at face amount) Preferred $2 stock, $20 par Common stock, $25 par Income tax is estimated at 40% of income. $550,000 550,000 550,000 Determine the earnings per share of common stock, assuming that the income before bond interest and income tax is (a) $253,000 $308,000, and (c) $363,000. Enter answers in dollars and cents, rounding to two decimal places.
Effect of Financing on Earnings per Share Henriksen Co., which produces and sells biking equipment, is financed as follows: Bonds payable, 10% (issued at face amount) Preferred $2 stock, $20 par Common stock, $25 par Income tax is estimated at 40% of income. $550,000 550,000 550,000 Determine the earnings per share of common stock, assuming that the income before bond interest and income tax is (a) $253,000 $308,000, and (c) $363,000. Enter answers in dollars and cents, rounding to two decimal places.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Effect of Financing on Earnings per Share
Henriksen Co., which produces and sells biking equipment, is financed as follows:
Bonds payable, 10% (issued at face amount)
$550,000
Preferred $2 stock, $20 par
550,000
Common stock, $25 par
550,000
Income tax is estimated at 40% of income.
Determine the earnings per share of common stock, assuming that the income before bond interest and income tax is (a) $253,000,
$308,000, and (c) $363,000.
Enter answers in dollars and cents, rounding to two decimal places.
a. Earnings per share on common stock $
b. Earnings per share on common stock $
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c. Earnings per share on common stock $
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