Financial statement data for the years ended December 31 for Black Bull Inc. follow:                                                                                    20Y6               20Y5Net income                                                              $2,485,700      $1,538,000Preferred dividends                                                  $50,000              $50,000Average number of common shares outstanding     115,000 shares    80,000 sharesa. Determine the earnings per share for 20Y6 and 20Y5.b. Does the change in the earnings per share from 20Y5 to 20Y6 indicate a favorable or unfavorable trend?

Financial And Managerial Accounting
15th Edition
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:WARREN, Carl S.
Chapter12: Corporations: Organization, Stock Transactions, And Dividends
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Problem 8BE: Earnings per share Financial statement data for the years 20Y5 and 20Y6 for Black Bull Inc. follow:...
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Financial statement data for the years ended December 31 for Black Bull Inc. follow:
                                                                                    20Y6               20Y5
Net income                                                              $2,485,700      $1,538,000
Preferred dividends                                                  $50,000              $50,000
Average number of common shares outstanding     115,000 shares    80,000 shares
a. Determine the earnings per share for 20Y6 and 20Y5.
b. Does the change in the earnings per share from 20Y5 to 20Y6 indicate a favorable or unfavorable trend?

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