FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:1.
Comparative Earnings per
Lucas Company reports net income of $2,520 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 3,600 shares of stock, resulting in 12,600 shares outstanding at year-end.
During 2020, Lucas earned net income of $18,120. It issued 3,000 additional shares of stock on March
3, 2020, and declared and issued a 2-for-1 stock split on November 3, 2020, resulting in 31,200
shares outstanding at year-end.
During 2021, Lucas earned net income of $29,952. 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.
Share
Ner iNCOme
20 20
24
per share
(2000% I2) 12000x 112)=1soo
10 SDC
2. Compute the 2019 and 2020 comparative basic earnings per share that would be disclosed in the
2020 annual report.
(12 000x2X C2,000+ 3000)N
4300 00015200 = DOG00
2020:
per share
18 12D
0.24
2019:
per share
30200
3. Compute the 2019, 2020, and 2021 comparative basic earnings per share that would be disclosed
in the 2021 annual report.
Net iNcOme aaasR
ir
(31 200 x1-x L31z00+ (31200 x 203
31200 x1,2xel12 37440 12
1372D 1872o
= 37140
O.80
2021: $
per share
2020: $
per share
per share
2019: $
032 8 fa
eot
36
Este
5.02
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