Question

Newcastle Enterprises had net income for 2024 of . Newcastle had shares of common stock outstanding at the beginning of the year and shares of common stock outstanding at the end of the year. There were shares of preferred stock outstanding all year. During​ 2024, Newcastle declared and paid preferred dividends of . What is​ Newcastle's earnings per​ share? (Round the answer to two decimal​ places.)

Answer 1

1.80

Step-by-step explanation:

Calculation for the earnings per​ share

First step is to calculate the Average number of common shares outstanding

Average number of common shares outstanding=($39,000 + $43,000) / 2

Average number of common shares outstanding = $41,000

Now let calculate the Earnings Per Share using this formula

Earnings Per Share = (Net income - Preferred dividends) / Average number of common shares outstanding

Let plug in the formula

Earnings Per Share = ($103,000 - $29,000) / $41,000

Earnings Per Share =$74,000/$41,000

Earnings Per Share = $1.80

Therefore the Earnings Per Share will be $1.80