Reunion Corporation provides the following information:
| March 31, 2018 | March 31, 2019 | |
| Net Income | $359,000 | $443,500 |
| Preferred Dividends | 0 | 0 |
| Total Stockholders’ Equity | $4,320,000 | $5,082,000 |
| Stockholders’ Equity attributable to Preferred Stock | 0 | 0 |
| Number of Common Shares Outstanding | $279,464 | $195,168 |
Based on the information provided above, compute the earnings per share of Reunion Corporation as of March 31, 2019.
A. $1.28
B. $1.51
C. $1.87
D. $2.27
Crane Company had 590,000 shares of common stock outstanding on January 1, issued 890,000 shares on July 1, and had income applicable to common stock of $2,930,000 for the year ending December 31, 2018. Earnings per share of common stock for 2018 would be _____ (rounded to the nearest penny).
a. $2.34
b. $4.97
c. $3.30
d. $2.83
Frantic Fast Foods had earnings after taxes of $1,320,000 in 20X1 with 384,000 shares outstanding. On January 1, 20X2, the firm issued 45,000 new shares. Because of the proceeds from these new shares and other operating improvements, earnings after taxes increased by 26 percent.
a. Compute earnings per share for the year 20X1. (Round the answer to 2 decimal places.)
b. Compute earnings per share for the year 20X2. (Round the answer to 2 decimal places.)
Earnings per share:
a. is calculated by dividing the earnings available to ordinary shareholders by the number of ordinary shares on the issue.
b. is complicated by the declaration of cash dividends during the year.
c. excludes the depreciation expense for the year.
d. is calculated based on the extraordinary earnings available to shareholders.
