Survey of Accounting (Accounting I)
8th Edition
ISBN: 9781337517386
Author: WARREN
Publisher: Cengage
expand_more
expand_more
format_list_bulleted
Question
Chapter 8, Problem 8.1.2P
To determine
Concept Introduction:
Basic Earnings per share:
The Basic Earnings per share is the amount of net income earned by each common share outstanding. The Earnings per share calculated by with help of following formula:
To Calculate:
The earnings per share for each plan
Expert Solution & Answer
Trending nowThis is a popular solution!
Students have asked these similar questions
2. Determine for each plan the earnings per share of common stock, assuming that the income before bond interest and income tax is $650,000.
Earnings per share of common stock
per share
per share
per share
Plan 1
Plan 2
Plan 3
+A
+A
+A
Hi,
Can you please help me with the following?
Only need help where the red Ex's are at for question 1/ plan 3 and for question 2/ plan 3
Chapter 8 Solutions
Survey of Accounting (Accounting I)
Ch. 8 - A business issued a $5,000, 60-day, 12% note to...Ch. 8 - Which of the following taxes are employers usually...Ch. 8 - Prob. 3SEQCh. 8 - Prob. 4SEQCh. 8 - A corporation has issued 25,000 shares of $100 par...Ch. 8 - For most companies, what two types of transactions...Ch. 8 - When are short-term notes payable issued?Ch. 8 - Prob. 3CDQCh. 8 - Prob. 4CDQCh. 8 - Identify the two distinct obligations incurred by...
Ch. 8 - A corporation issues $40,000,000 of 6% bonds to...Ch. 8 - The following data relate to an $8,000,000,7% bond...Ch. 8 - When should the liability associated with a...Ch. 8 - Prob. 9CDQCh. 8 - Prob. 10CDQCh. 8 - Prob. 11CDQCh. 8 - Prob. 12CDQCh. 8 - Prob. 13CDQCh. 8 - A corporation reacquires 18,000 shares of its Own...Ch. 8 - Prob. 15CDQCh. 8 - Prob. 16CDQCh. 8 - Prob. 17CDQCh. 8 - Prob. 18CDQCh. 8 - Effect of financing on earnings per share BSF Co.....Ch. 8 - Evaluate alternative financing plans Obj. 1 Based...Ch. 8 - Current liabilities Zahn Inc. -told 16.000annual...Ch. 8 - Notes payable Obj. A business issued a 90-day. 7%...Ch. 8 - Compute payroll An employee earns $28 per hour and...Ch. 8 - Prob. 8.6ECh. 8 - Prob. 8.7ECh. 8 - Prob. 8.8ECh. 8 - Bond price CVS Caremark Corp. (CVS) 5-3% bonds due...Ch. 8 - Issuing bonds Cyber Tech Inc. produces and...Ch. 8 - Accrued product warranty Back in Time Inc....Ch. 8 - Accrued product warranty Ford Motor Company (F)...Ch. 8 - Prob. 8.13ECh. 8 - Prob. 8.14ECh. 8 - Issuing par stock On January 29. Quality Marble...Ch. 8 - Issuing stock for assets other than cash Obj.5 On...Ch. 8 - Treasury stock transactions Obj.5 Blue Moon Water...Ch. 8 - Prob. 8.18ECh. 8 - Treasury stock transactions Banff Water Inc....Ch. 8 - Cash dividends The date of declaration, date of...Ch. 8 - Prob. 8.21ECh. 8 - Effect of stock split Audrey's Restaurant...Ch. 8 - Prob. 8.23ECh. 8 - Prob. 8.24ECh. 8 - Prob. 8.1.1PCh. 8 - Prob. 8.1.2PCh. 8 - Prob. 8.1.3PCh. 8 - Recording payroll and payroll taxes The following...Ch. 8 - Recording payroll and payroll taxes The following...Ch. 8 - Recording payroll and payroll taxes The following...Ch. 8 - Recording payroll and payroll taxes The following...Ch. 8 - Bond premium; bonds payable transactions Beaufort...Ch. 8 - Prob. 8.3.2PCh. 8 - Bond premium; bonds payable transactions Beaufort...Ch. 8 - Prob. 8.3.4PCh. 8 - Stock transactions for corporate expansion Vaga...Ch. 8 - Dividends on preferred and common stock Yukon Bike...Ch. 8 - Dividends on preferred and common stock Yukon Bike...Ch. 8 - Prob. 8.5.3PCh. 8 - Prob. 8.1.1MBACh. 8 - Prob. 8.1.2MBACh. 8 - Prob. 8.2.1MBACh. 8 - Prob. 8.2.2MBACh. 8 - Prob. 8.2.3MBACh. 8 - Prob. 8.3.1MBACh. 8 - Prob. 8.3.2MBACh. 8 - Prob. 8.3.3MBACh. 8 - Prob. 8.4MBACh. 8 - Prob. 8.5.1MBACh. 8 - Prob. 8.5.2MBACh. 8 - Prob. 8.6.1MBACh. 8 - Prob. 8.6.2MBACh. 8 - Prob. 8.6.3MBACh. 8 - Stock split Using the data from E8-22. indicate...Ch. 8 - Prob. 8.8.1MBACh. 8 - Prob. 8.8.2MBACh. 8 - Prob. 8.8.3MBACh. 8 - Prob. 8.8.4MBACh. 8 - Prob. 8.8.5MBACh. 8 - Prob. 8.8.6MBACh. 8 - Prob. 8.8.7MBACh. 8 - Prob. 8.8.8MBACh. 8 - Prob. 8.9.1MBACh. 8 - Prob. 8.9.2MBACh. 8 - Prob. 8.9.3MBACh. 8 - Prob. 8.9.4MBACh. 8 - Prob. 8.9.5MBACh. 8 - Prob. 8.9.6MBACh. 8 - Debt and price-earnings ratios Lowe's Companies...Ch. 8 - Prob. 8.10.1MBACh. 8 - Prob. 8.10.2MBACh. 8 - Prob. 8.10.3MBACh. 8 - Prob. 8.10.4MBACh. 8 - Prob. 8.10.5MBACh. 8 - Debt and price-earnings ratios Alphabet (formerly...Ch. 8 - Prob. 8.10.7MBACh. 8 - Prob. 8.10.8MBACh. 8 - Prob. 8.11MBACh. 8 - Prob. 8.1.1CCh. 8 - Prob. 8.1.2CCh. 8 - Prob. 8.2.1CCh. 8 - Prob. 8.2.2CCh. 8 - Prob. 8.3.1CCh. 8 - Issuing stock Sahara Unlimited Inc. began...Ch. 8 - Prob. 8.4CCh. 8 - Prob. 8.5.1CCh. 8 - Financing business expansion You hold a 30% common...
Knowledge Booster
Similar questions
- Brower Co. is considering the following alternative financing plans: Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming that income before bond interest and income tax is 2,000,000.arrow_forwardThree different plans for financing a $7,400,000 corporation are under consideration by its organizers. Under each of the following plans, the securities will be issued at their par or face amount, and the income tax rate is estimated at 40% of income. Plan 1 Plan 2 Plan 3 10% bonds $3,700,000 Preferred 10% stock, $100 par $3,700,000 1,850,000 Common stock, $7.4 par $7,400,000 3,700,000 1,850,000 Total $7,400,000 $7,400,000 $7,400,000 Round the answers to nearest cent. Instructions: 1. Determine for each plan the earnings per share of common stock, assuming that the income before bond interest and income tax is $14,800,000. Earnings per share of common stock Plan 1 $ per share Plan 2 $1 per share Plan 3 $4 per share 2. Determine for each plan the earnings per share of common stock, assuming that the income before bond interest and income tax is $7,030,000. Earnings per share of common stock Plan 1 24 per share Plan 2 $4 per share Plan 3 $ per sharearrow_forwardThree different plans for financing a $2,200,000 corporation are under consideration by its organizers. Under each of the following plans, the securities will be issued at their par or face amount, and the income tax rate is estimated at 40% of income. Plan 1 Plan 2 Plan 3 10% bonds $1,100,000 Preferred 10% stock, $100 par $1,100,000 550,000 Common stock, $2.2 par $2,200,000 1,100,000 550,000 Total $2,200,000 $2,200,000 $2,200,000 Round the answers to nearest cent.arrow_forward
- Three different plans for financing an $2,100,000 corporation are under consideration by its organizers. Under each of the following plans, the securities will be issued at their par or face amount, and the income tax rate is estimated at 40% of income: Plan 1 Plan 2 Plan 3 10% Bonds _ _ $1,050,000 Preferred 5% stock, $80 par _ $1,050,000 525,000 Common stock, $2.1 par $2,100,000 1,050,000 525,000 Total $ 2,100,000 $ 2,100,000 $ 2,100,000 Required: 1. Determine the earnings per share of common stock for each plan, assuming that the income before bond interest and income tax is $4,200,000. Enter answers in dollars and cents, rounding to two decimal places. Earnings Per Share on Common Stock Plan 1 $fill in the blank 1 Plan 2 fill in the blank 2 Plan 3 fill in the blank 3 2. Determine the earnings per share of common stock for each plan, assuming that the income before bond interest and income tax is $1,995,000. Enter answers in…arrow_forwardSorenson Co. is considering the following alternative plans for financing the company: Plan 1 Plan 2 Issue 10% bonds (at face) $3,000,000 Issue $10 par common stock $4,000,000 1,000,000 Income tax is estimated at 40% of income. Determine the earnings per share of common stock under the two alternative financing plans, assuming income before bond interest and income tax is $1,000,000. Round your answers to two decimal places. Earnings Per Common Share Plan 1 Plan 2arrow_forwardSubject :- Accounting Three plans for financing a $28,500,000 corporation are under consideration by its organizers. Under each of the following plans, the securities will be issued at their par or face amount and the income tax rate is estimated at 30%. 9% Bonds 6% Preferred Stock, $100 par Common Stock, $10 par Total Plan 1 Net income $28,500,000 $28,500,000 Earnings per share on common stock Plan 2 $ $14,250,000 $ 14,250,000 It is estimated that income before interest and taxes will be $7,125,000. $28,500,000 $14,250,000 Determine for each plan, the expected net income and the earnings per share on common stock. (Round earnings per share to 2 decimal places, e.g. 2.25.) Plan 1 Plan 3 7,125,000 $28,500,000 $ 7,125,000 Plan 2 $ $ Plan 3arrow_forward
- Sorenson Co. is considering the following alternative plans for financing the company: Plan 1 Plan 2 Issue 10% Bonds (at face) - $20,000 Issue $10 par Common Stock $30,000 $10,000 Income tax is estimated at 40% of income. Determine the earnings per share of common stock under the two alternative financing plans, assuming income before bond interest and income tax is $9,000. Round your answers to two decimal places. Plan 1 Plan 2arrow_forwardHow do i work through Plan 2?arrow_forwardSimonelli Co. is considering the following alternative financing plans: Plan 1 Plan 2 Issue 8% bonds (at face value) $5,000,000 4,000,000 Issue preferred $2.00 stock, $20 par — 2,000,000 Issue common stock, $25 par 5,000,000 4,000,000 Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming income before bond interest and income tax is $1,000,000.arrow_forward
- Question Content Area Jenson Co. is considering the following alternative plans for financing the company: Plan 1 Plan 2 Issue 10% bonds (at face) — $2,000,000 Issue $10 common stock $3,000,000 1,000,000 Income tax is estimated at 40% of income. Determine the earnings per share of common stock under the two alternative financing plans, assuming income before bond interest and income tax is $1,000,000. Round your answers to two decimal places. Earnings per Shareon Common Stock Plan 1 $fill in the blank 1 Plan 2 $fill in the blank 2arrow_forwardSubject: accountingarrow_forwardDesmond Co. is considering the following alternative financing plans: Plan 1 Plan 2 Issue 10% bonds (at face value) $840,000 $420,000 Issue preferred $1 stock, $10 par — 700,000 Issue common stock, $5 par 840,000 560,000 Income tax is estimated at 40% of income. Determine the earnings per share of common stock, assuming that income before bond interest and income tax is $504,000. Enter answers in dollars and cents, rounding to two decimal places. Plan 1 $fill in the blank 1 Earnings per share on common stock Plan 2 $fill in the blank 2 Earnings per share on common stockarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Survey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
Financial AccountingAccountingISBN:9781337272124Author:Carl Warren, James M. Reeve, Jonathan DuchacPublisher:Cengage Learning
Financial AccountingAccountingISBN:9781305088436Author:Carl Warren, Jim Reeve, Jonathan DuchacPublisher:Cengage Learning
Cornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
Survey of Accounting (Accounting I)
Accounting
ISBN:9781305961883
Author:Carl Warren
Publisher:Cengage Learning
Financial Accounting
Accounting
ISBN:9781337272124
Author:Carl Warren, James M. Reeve, Jonathan Duchac
Publisher:Cengage Learning
Financial Accounting
Accounting
ISBN:9781305088436
Author:Carl Warren, Jim Reeve, Jonathan Duchac
Publisher:Cengage Learning
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning