UmDedugelystudentmainfruni nment CALCULATOR FULL SCREEN PRIN

UmDedugelystudent/mainfr.uni nment CALCULATOR FULL SCREEN PRINTERVERSION ·BACK NEXT Question 1 At December 31, 2016, Cheyenne Corporation had the following stock outstanding. 10% cumulative preferred stock, $100 par, 107,612 shares $10,761,200 Common stock, $5 par, 4,070,700 shares 20,353,500 During 2017, Cheyenne did not issue any additional common stock. The following also occurred during 2017. Income from continuing operations before taxes Discontinued operations (loss before taxes) Preferred dividends declared Common dividends declared Effective tax rate $22,052,200 $3,517,800 $1,076,120 $2,011,400 35 % Compute earnings per share data as it should appear in the 2017 income statement of Cheyenne Corporation. (Round answers to 2 decimal places, e.g. 1.48.) Earnings Per Share Income from Continuing Operations s 1433393 Discontinued Operations Net Income / (Loss)

Solution

Earnings per share: Income from continuing operations 3.26 (14333930-1076120)/4070700 Discontinued operations, net of tax 0.56 (2286570)/4070700 Net income 2.70 (12047360-1076120)/4070700 INCOME STATEMENT Net income: Income from continuing operation before income tax 22052200 Income tax (35% * 22,052,200) 7718270 Income from continuing operations 14333930 Discontinued operations Loss before taxes 3517800 Less applicable income tax (35%) 1231230 2286570 Net income 12047360 Preferred dividends declared 1076120 Weighted average common shares outstanding 40,70,700