Glow Corporation has 50,000 shares of preferred shares outstanding, with annual dividends paid at the rate of $1.50 per share. Glow also has 100,000 shares of common shares outstanding.
If Glow declares a $250,000 dividend in 2013, each outstanding share of common shares would receive:
A. $1.50
B. $1.75
C. $1.17
D. $2.50
The Heath Corporation reported a net income for 2015 of $177,500. Heath began the year with 100,000 shares of $5 par value common shares outstanding and 2,500 shares of $100 par value 8% preferred shares outstanding. On October 1, Heath sold 10,000 shares of common stock for $6 per share.
Heath paid dividends to the common shareholders in December. The basic earnings for 2015 are:
A. $1.43 per share.
B. $1.50 per share.
C. $1.54 per share.
D. $1.73 per share.
The net income of Foster Furniture. Inc. amounted to $1,920,000 for the current year.
Compute the amount of earnings per share assuming that the shares of capital stock outstanding throughout the year consisted of:
1. 400,000 shares of $ 1 par value common stock and no preferred stock.
2. 100,000 shares of 8 percent, $ 100 par value preferred stock and 300,000 shares of $5 par value common stock.
b. Is the earnings per share figure computed in part a(2) considered to be basic or diluted’ Explain.
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