Ask Question
31 March, 12:08

The Abel Company provided the following information from its financial records: Net income $ 250,000 Common shares outstanding 1/1 200,000 Common stock dividends $ 20,000 Common shares outstanding 12/31 300,000 Preferred stock dividends $ 25,000 Preferred shares outstanding 1/1 10,000 Sales $ 1,000,000 Preferred shares outstanding 12/31 6,000 What is the amount of the company's earnings per share?

+2
Answers (1)
  1. 31 March, 15:38
    0
    The amount of the company's earnings per share is $0.90 per share.

    Explanation:

    The formula to compute earning per share is shown below:

    = (Net income - preferred stock dividend) : Average number of common shares outstanding

    where,

    average number of common shares outstanding is equals to

    = (Opening balance + ending balance) : 2

    = (200,000 + 300,000) : 2 = 250,000 shares

    Now, put the values in the above formula which is equals to

    = ($250,000 - $25,000) : 250,000 shares

    = $0.90 per share

    Hence, the amount of the company's earnings per share is $0.90 per share.
Know the Answer?
Not Sure About the Answer?
Get an answer to your question ✅ “The Abel Company provided the following information from its financial records: Net income $ 250,000 Common shares outstanding 1/1 200,000 ...” in 📙 Business if there is no answer or all answers are wrong, use a search bar and try to find the answer among similar questions.
Search for Other Answers