The following selected data are for Geneva Company:
-The earnings per share of common stock for Year 2 is closest to:
A)$1.60
B)$2.07
C)$3.27
D)$3.67

Question

The following selected data are for Geneva Company: 
-The earnings per share of common stock for Year 2 is closest to:
A)$1.60 
B)$2.07 
C)$3.27 
D)$3.67

Quizplus · Accepted Answer

Number of common shares outstanding = Common stock F1F1F1S1F1F1F10 Par value
= $600 F1F1F1S1F1F1F10 $20 per share = 30 shares
Earnings per share = (Net Income - Preferred Dividends)
F1F1F1S1F1F1F10 Average number of common shares outstanding
= ($110 - $12)F1F1F1S1F1F1F10 (30 shares + 30 shares)/2 = $3.27 per share

The Following Selected Data Are for Geneva Company