(EPS: Simple Capital Structure) A portion of the statement of income and retained earnings of Pierson Inc. for the current year follows. Note 1 during the year, Pierson Inc. suffered a major casualty loss of $1,340,000 after applicable income tax reduction of $1,200,000. At the end of the current year, Pierson Inc. has outstanding 8,000,000 shares of $10 par common stock and 50,000 shares of 6% preferred. On April 1 of the current year, Pierson Inc. issued 1,000,000 shares of common stock for $32 per share to help finance the casualty. Compute the earnings per share on common stock for the current year as it should be reported to stockholders.

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Income before extraordinary item Extraordinary loss, net of applicable income tax (Note 1) Net income Retained earnings at the beginning of the year Dividends declared: On preferred stock-$6.00 per share On common stock-$1.75 per share Retained earnings at the end of the year $ 300,000 14,875,000 $15,000,000 1,340,000 13,660,000 83,250,000 96,910,000 15,175,000 $81,735,000