Earnings per share: Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’. The following formula can be used to calculate earnings per share: Earnings per share = Net income ( loss ) – Preferred dividends Average number of common shares outstanding The earnings per share of Company P for Year 1-3.

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Answer 1

Question

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

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For the month ended January 31, 2024, Cameron Enterprises reported revenues of $52,000, expenses of $56,500, and dividends of $4,200. Cameron Enterprises experienced a net income or net loss of what amount?

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Answer 2

Question

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

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Answer 3

Question

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

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Answer 4

Question

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

Expert Solution & Answer

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Answer 5

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

Answer 6

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

Answer 7

Chapter 12, Problem 12.2ADM

(a)

To determine

Earnings per share:

Earnings per share represent the amount of income earned per share of outstanding common stock in a period. This ratio is used for analyzing the profitability of company’s stockholders’.

The following formula can be used to calculate earnings per share:

Earnings per share = Net income(loss) – Preferred dividendsAverage number of common shares outstanding

The earnings per share of Company P for Year 1-3.

Answer 8

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

Answer 9

(b)

To determine

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

Answer 10

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Answer 11

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Answer 12

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Answer 13

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Solution Summary: The author explains how the following formula can be used to calculate the earnings per share of Company P for Year 3, Year 2, and Year 1.

To interpret: The trend in earnings per share using horizontal analysis for 3 years in terms of change in earnings and average shares outstanding.

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Chapter 12 Solutions