Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN: 9781337788281
Author: James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher: Cengage Learning
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Chapter 16, Problem 18E
Monona Company reported net income of $29,975 for 2019. During all of 2019, Monona had 1,000 shares of 10%, $100 par, nonconvertible
Required:
- 1. Compute Monona’s basic earnings per share for 2019.
- 2. Compute the price/earnings ratio for 2019.
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Monona Company reported net income of $29,975 for 2019. During all of 2019, Monona had 1,000 shares of 10%, $100 par, nonconvertible preferred stock outstanding, on which the year’s dividends had been paid. At the beginning of 2019, the company had 7 ,000 shares of common stock outstanding. On April 2, 2019，The company issued another 2,000 shares of common stock so that 9 ,000 common shares were outstanding at the end of 2019. Common dividends of $17,000 had been paid during 2019. At the end of 2019, the market price per shaare of common stock was $17.50.
1. Compute Monona’s basic earnings per share for 2019. 2. Compute the price/earnings ratio for 2019.
Lucas Company reports net income of $5,125 for the year ended December 31, 2019, its first year of operations. On January 4, 2019, Lucas issued 9,000 shares of common stock. On August 2, 2019, it issued an additional 3,000 shares of stock, resulting in 12,000 shares outstanding at year-end.
During 2020, Lucas earned net income of $16,400. It issued 2,000 additional shares of stock on March 3, 2020, and declared and issued a 2-for-1 stock split on November 3, 2020, resulting in 28,000 shares outstanding at year-end.
During 2021, Lucas earned net income of $23,520. The only common stock transaction during 2021 was a 20% stock dividend issued on July 2, 2021.
Compute the 2019, 2020, and 2021 comparative basic earnings per share that would be disclosed in the 2021 annual report.
Lucas Company reports net income of $5,125 for the year ended December 31, 2019, its first year of operations. On January 4, 2019, Lucas issued 9,000 shares of common stock. On August 2, 2019, it issued an additional 3,000 shares of stock, resulting in 12,000 shares outstanding at year-end.
During 2020, Lucas earned net income of $16,400. It issued 2,000 additional shares of stock on March 3, 2020, and declared and issued a 2-for-1 stock split on November 3, 2020, resulting in 28,000 shares outstanding at year-end.
During 2021, Lucas earned net income of $23,520. The only common stock transaction during 2021 was a 20% stock dividend issued on July 2, 2021.
If required, round your final answers to two decimal places.
Required:
1. Compute the basic earnings per share that would be disclosed in the 2019 annual report.$ per share2. Compute the 2019 and 2020 comparative basic earnings per share that would be disclosed in the 2020 annual report.2020: $ per share2019: $ per share3.…
Chapter 16 Solutions
Intermediate Accounting: Reporting And Analysis
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