Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Common Stockholders 14,180,000 Loss from Per Shares Outstanding Share 20,504,952 x 0.69 Discontinued Operations, Net of tax $ (2,950,000) Net Income Available to Common Stockholders 0x / Weighted Avg. Common Per Shares Outstanding Share Weighted Avg. Common Shares Outstanding Per Share 0x - $
Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Common Stockholders 14,180,000 Loss from Per Shares Outstanding Share 20,504,952 x 0.69 Discontinued Operations, Net of tax $ (2,950,000) Net Income Available to Common Stockholders 0x / Weighted Avg. Common Per Shares Outstanding Share Weighted Avg. Common Shares Outstanding Per Share 0x - $
Excel Applications for Accounting Principles
4th Edition
ISBN:9781111581565
Author:Gaylord N. Smith
Publisher:Gaylord N. Smith
Chapter13: Earnings Per Share (eps)
Section: Chapter Questions
Problem 1R: Ponce Towers, Inc., had 50,000 shares of common stock and 10,000 shares of 100 par value, 8%...
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Transcribed Image Text:Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure
consists of the following.
■ Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year.
■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued.
Required
a. What type of capital structure does this company have (simple or complex)? Simple structure
b. Compute required EPS amounts.
c. Show the EPS presentation for financial reporting.
Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny.
Note: Use a negative sign with a loss.
Income from Continuing
Weighted
Operations Available to
Avg. Common
Shares
Per
Common Stockholders
Outstanding
Share
$
20,504,952 x = $
0.69
14,180,000
Loss from
Discontinued
Operations, Net of tax
$
(2,950,000) ✔
Net Income Available to
Common Stockholders
$
0 x
Weighted
Avg. Common
Per
Shares
Outstanding
0x = $
Share
Weighted Avg. Common
Shares Outstanding
Per
Share
0 x = $
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