Speed Inc.reported a net income equal to $15,000.The dividends declared & paid to the preferred shareholders equaled $ 5,000 and paid the common stockholders a dividend of $8,000.Speed Inc.had 10,000 shares outstanding all year long.What value is Speed Inc.'s earnings per share?
A)$ .50
B)$ 1.00
C)$ 1.50
D)$ .20

Question

Quizplus · Accepted Answer

Earnings per share (EPS) is calculated as (Net Income - Preferred Dividends) / Average Outstanding Shares. Here, it's ($15,000 - $5,000) / 10,000 = $1.00.

Speed IncReported a Net Income Equal to $15,000