At December 31, 2020, Albrecht Corporation had outstanding 348,000 shares of common stock and 18,000 shares of 9.5%, $100 par value cumulative, nonconvertible preferred stock. On May 31, 2021, Albrecht sold for cash 12,000 shares of its common stock. No cash dividends were declared for 2021. For the year ended December 31, 2021, Albrecht reported a net loss of $1,391,000.
Calculate Albrecht’s net loss per share for the year ending December 31, 2021.
Ameth Growers has historically had a P/E ratio of 21.4. This ratio is considered a good estimate of the future ratio. The firm currently has an EPS of $2.34. These earnings are expected to increase by 3.4 percent next year.
What is the expected price of this stock one year from now?
a. $45.54
b. $48.43
c. $50.25
d. $51.78
e. $53.79
Blossom Airlines is considering two alternatives for the financing of a purchase of a fleet of airplanes. These two alternatives are:
1. Issue 75,000 shares of common stock at $30 per share. (Cash dividends have not been paid nor is the payment of any contemplated.)
2. Issue 6%, 10-year bonds at face value for $2,250,000.
It is estimated that the company will earn $700,000 before interest and taxes as a result of this purchase. The company has an estimated tax rate of 30% and has 100,000 shares of common stock outstanding prior to the new financing.
Determine the effect on net income and earnings per share for these two methods of financing.
The Common Stock account for Baltimore Corporation on January 1, 2018, was $75,000. On July 1, 2018, Baltimore issued an additional 9,000 shares of common stock. The Common Stock is $5 par. There was neither Preferred Stock nor any Treasury Stock. Paid in Capital Excess to par Common Stock was $20,000 on January 1 and $40,000 on July 2 and net income were $127,500.
Use this information to determine for December 31, 2018, the amount of Earnings per Share.
