A company reports the following:? Net income $ 150 , 000 Preferred dividends $ 10 , 000 Shares of common stock outstanding 20 , 000 Market price per share of common stock $ 35 \begin{array}{lr} ext { Net income } & \$ 150,000 \ ext { Preferred dividends } & \$ 10,000 \ ext { Shares of common stock outstanding } & 20,000 \ ext { Market price per share of common stock } & \$ 35\end{array} Net income Preferred dividends Shares of common stock outstanding Market price per share of common stock $150 , 000 $10 , 000 20 , 000 $35 Calculate the company's earnings per share on common stock.

Question

A company reports the following:?    Net income  $ 150 , 000  Preferred dividends  $ 10 , 000  Shares of common stock outstanding  20 , 000  Market price per share of common stock  $ 35 \begin{array}{lr}	ext { Net income }  &  \$ 150,000 \	ext { Preferred dividends }  &  \$ 10,000 \	ext { Shares of common stock outstanding }  &  20,000 \	ext { Market price per share of common stock }  &  \$ 35\end{array}  Net income   Preferred dividends   Shares of common stock outstanding   Market price per share of common stock  ​ $150 , 000 $10 , 000 20 , 000 $35 ​   Calculate the company's earnings per share on common stock.

Katherine Calimlim · Accepted Answer

Final Answer : Earnings per Share on Common Stock =  (Net Income - Preferred Dividends)/Shares ofCommon Stock Outstanding.Earnings per Share =  ($150,000 - $10,000)/20,000Earnings per Share = $7.00

Definitions

Learning Objectives

Learning Objectives

Related questions