Use a computer spreadsheet program to determine earnings per share in each of the following independent situations. Assume a calendar year-end in each situation.
A. Net income is $500,000. There are 250,000 shares of common stock and 50,000 shares of $10 par, 8 percent preferred stock outstanding.
B. Net income is $600,000. There were 200,000 shares of common stock outstanding on January 1. On March 31, 100,000 additional shares were issued. On September 1, 50,000 additional shares were issued.
C. Net income is $250,000. There were 300,000 shares of common stock outstanding on January 1. On July 31, 50,000 shares of common stock were repurchased and held as treasury stock.
D. Net income is $425,000. There were 200,000 shares of common stock and 10,000 shares of $100 par, 6 percent preferred stock outstanding on January 1. On May 1, 60,000 shares of common stock were issued. On October 31, 10,000 shares of common stock were issued.
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