Information from the financial statements of Ames Fabricators, Inc., included the following: Ames's net income for the

Question:

Information from the financial statements of Ames Fabricators, Inc., included the following:

Ames's net income for the year ended December 31, 2011, is $500,000. The income tax rate is 40%. Ames paid dividends of $5 per share on its preferred stock during 2011.

Required:

Compute basic and diluted earnings per share for the year ended December 31, 2011.

Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial...