
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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A portion of the combined statement of income and
Income from continuing operations |
$15,000,000
|
|
Loss from discontinued operations, net of applicable income tax (Note 1) |
1,340,000
|
|
Net income |
13,660,000
|
|
Retained earnings at the beginning of the year |
83,250,000
|
|
96,910,000
|
||
Dividends declared: | ||
00On |
$ 300,000
|
|
00On common stock—$1.75 per share |
14,875,000
|
15,175,000
|
Retained earnings at the end of the year |
$81,735,000
|
|
Note 1. During the year, Seminole Inc. suffered a major loss from discontinued operations of $1,340,000 after applicable income tax reduction of $1,200,000. |
At the end of the current year, Seminole Inc. has outstanding 8,500,000 shares of $10 par common stock and 50,000 shares of 6% preferred. On April 1 of the current year, Seminole Inc. issued 1,000,000 shares of common stock for $32 per share to help finance the loss from discontinued operations.
Instructions
Compute the earnings per share on common stock for the current year as it should be reported to stockholders.
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