Question

x Your answer is incorrect. Try again. The shareholders' equity section of Swifty Corporation as at December 31, 2020, follows: 10% cumulative preferred shares, 100,000 shares authorized, 81,000 shares outstanding Common shares, 10 million shares authorized and issued Contributed surplus $4,500,000 10,000,000 10,700,000 25,200,000 181,000,000 $206,200,000 Retained earnings Net income of $25 million for 2020 reflects a total effective tax rate of 26%. Included in the net income figure is a loss of $16 million (before tax) relating to the operations of a business segment that is to be discontinued. Calculate earnings per share information as it should appear in the financial statements of Swifty Corporation for the year ended December 31, 2020. (Round answers to 2 decimal places, e.g. 52.75.) Earnings per share Continuing Operations 3.79 Discontinued Operations 3.79 Net Income / (Loss) 3.79 LINK TO TEXT Version 4.2

Answer 1

Above question is about to find out earnings per share and it's presentation on financial statements. Refer below images for more detailed solution.
Solotion : * Formula: Earnings per Shave = Net profit available weighted Avg-number of for equity Shave holders shares outstanding during the year. calculation of Net income : particolars Amount Given 2020 net income after tax $25 000 000 2020 net income before tax [ $25000000 (1-0-26] - $33783784 $ 25000000 0.74 Add: Loss from discontinued operations $16 000 000 Income from continuing operations → $4 erotions > $497837-84 Less: Income Tax [$49783784 x 26 ] $ 129437.84) Income before discontinued 36840 000 operations (1) Discontinued operations : $ 16000 doo Loss Less: from operations Applicable income tax reduction ($ 4160000) Lant Direct 1 [416000.000] (B) → $11840000 :. Net income (A-B) → $ 25000 000 [$36840000 - $11840000] I Note point): 0 Given applicable tax rate is 26).

$25000000 & (450000) Net income Less: Comolative preferred dividends [$4500000 x 1 Net income available for Common equity shares $24550000 * computation of earnings per Share : $24550000 10 000 000 = Share Earnings per = $2.46 per Share Given outstanding Shares Note :- are 10,000,000 Shares Income Statement presentation : Earnings per Share : continuing operations Discontinued operations $ 3.64 $11.1970 bor $ 2.46 Net income of Direct labor hours Working: as Income before discontinued operations - Condlative preferred dividend outstanding no. of Shares = $36840000 - $450000 = $3.64 10 000 000 b) Loss from operations (1-qax rate) - $16000 DOD X (1-26) outstanding no of shares 10 000 000 $16000000 X 0.74 10 000 000 = $ 1.18