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14 July, 02:39

Parsley Corporation had 250,000 shares of common stock and 5,000 shares of 8%, $100 par, preferred stock outstanding on December 31, 2017. The preferred stock is cumulative, nonconvertible preferred stock. On June 1, 2018, Parsley sold 36,000 shares of common stock for cash. No cash dividends were declared for 2018. Parsley reported a net loss of $320,000 for the year ended December 31, 2018. Calculate Parsley's loss per share for the year ended December 31, 2016. (Round your answer to 2 decimal places.)

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  1. 14 July, 05:09
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    Calculation of total loss:

    Net loss 320,000

    Preferred dividend [5000*8%*100] 40,000

    Total loss 360,000

    Calculation of shares:

    Common shares 250,000

    Additional common stock [36,000*7/12] 21,000

    Total shares 271,000

    Loss per share = 360,000/271,000 = $1.328
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