Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Common Stockholders 14,180,000 Loss from Per Shares Outstanding Share 20,504,952 x 0.69 Discontinued Operations, Net of tax $ (2,950,000) Net Income Available to Common Stockholders 0x / Weighted Avg. Common Per Shares Outstanding Share Weighted Avg. Common Shares Outstanding Per Share 0x - $
Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Common Stockholders 14,180,000 Loss from Per Shares Outstanding Share 20,504,952 x 0.69 Discontinued Operations, Net of tax $ (2,950,000) Net Income Available to Common Stockholders 0x / Weighted Avg. Common Per Shares Outstanding Share Weighted Avg. Common Shares Outstanding Per Share 0x - $
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure
consists of the following.
■ Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year.
■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued.
Required
a. What type of capital structure does this company have (simple or complex)? Simple structure
b. Compute required EPS amounts.
c. Show the EPS presentation for financial reporting.
Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny.
Note: Use a negative sign with a loss.
Income from Continuing
Weighted
Operations Available to
Avg. Common
Shares
Per
Common Stockholders
Outstanding
Share
$
20,504,952 x = $
0.69
14,180,000
Loss from
Discontinued
Operations, Net of tax
$
(2,950,000) ✔
Net Income Available to
Common Stockholders
$
0 x
Weighted
Avg. Common
Per
Shares
Outstanding
0x = $
Share
Weighted Avg. Common
Shares Outstanding
Per
Share
0 x = $
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 5 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education