Going Green, Inc.had 18, 000 shares of common stock outstanding on January 1.An additional 6, 000 shares were issued on May 1.The company also had 1, 000 shares of 5.5%, $100 par, convertible preferred stock outstanding during the year.Each share is convertible into 8 shares of common stock.Net income for the year was $82, 500.
Required:
Compute the appropriate earnings per share amount(s)that would appear on the Going Green's income statement.

Question

Zybrea Knight · Accepted Answer

Final Answer :

Basic earnings per share: $Basic earnings per share: Basic earnings per share: $77, 000/22, 000 shares = $3.50 Diluted earnings per share: \begin{array}{ll} \text { Numerator: } & \$ 82,500 \\ \text { Denominator: } & 22,000 \text { shares }+(1,000 ' 8)=30,000 \text { shares } \end{array} Diluted earnings per share: $82, 500/30, 000 shares = $2.75$ Basic earnings per share: $77, 000/22, 000 shares = $3.50 Diluted earnings per share:

\begin{array}{ll}\text { Numerator: } & \$ 82,500 \\\text { Denominator: } & 22,000 \text { shares }+(1,000 ' 8)=30,000 \text { shares }\end{array}

Diluted earnings per share: $82, 500/30, 000 shares = $2.75

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