Question

Good evening, I am having some difficulty with this problem. Could someone please help me. If you wouldn't mind showing your work, this way I will understand how to work a problem like this in the future. Thank you in advance for your help.

Module 5 Homework i Saved 3 Ringmeup Inc. had net income of $168,700 for the year ended December 31, 2019. At the beginning of the year, 37,000 shares of common stock were outstanding. On May 1, an additional 15,000 shares were issued. On December 1, the company purchased 4,900 shares of its own common stock and held them as treasury stock until the end of the year. No other changes in common shares outstanding occurred during the year. During the year, Ringmeup paid the annual dividend on the 8,000 shares of 3.45%, $100 par value preferred stock that were outstanding the entire year. 12.5 polnts Required: Calculate basic earnings per share of common stock for the year ended December 31, 2019. (Do not round intermediate calculations. Round your answer to 2 decimal places.) eBook Earnings per share Hint

Answer 1

Basic Earnings Per Share = — Earnings attributable to Common Stock Holders Weighted Average number of shares outstanding at the end of year Earnings attributable to common stock holders Net Income $ 1,68,700 Less: Preferred Stock Dividend paid in the year 27,600 (8,000 X 3.45% X $100) $ 1,41,100 Weighted Average number of shares outstanding at the end of year (37,000 X 11/12) 33,916.67 (15,000 X 8/12) 10,000.00 (37,000 - 4,900) X 1/12) 2,675.00 Total $ 46,591.67 Basic Earnings Per Share = $141,100 / 46,591.67 = 3.03 Earning per share. 3.03