Amber Corporation holds 70 percent of the voting common shares of Newtop Company, but none of its preferred shares. Summary balance sheets for the companies on December 31, 20X1, are as follows:

Neither of the preferred issues is convertible. Amber Corporation's preferred pays a 9 percent annual dividend, and Newtop Company's preferred pays a 10 percent dividend. Newtop Company reported net income of \(\$ 45,000\) and paid a total of \(\$ 20,000\) of dividends in \(20 \mathrm{X} 1\). Amber Corporation reported income from its separate operations of \(\$ 59.000\) and paid total dividends of \(\$ 45.000\) in \(20 \times 1\).
\section*{Required}
Compute 20X1 consolidated earnings per share. Ignore any tax consequences.

Transcribed Image Text:

Cash Amber Corporation $ 14.000 Newtop Company $ 30.000 50.000 Accounts Receivable Inventory 40.000 110.000 80,000 Buildings and Equipment 280.000 200.000 Less: Accumulated Depreciation (130.000) (60.000) Investment in Newtop Company 126.000 Total Assets $440.000 $300.000 Accounts Payable $ 70.000 $ 70.000 Wages Payable 40.000 Preferred Stock 100.000 50.000 Common Stock ($10 par value) 120.000 100.000 Retained Earnings 110,000 80.000 Total Liabilities and Owners' Equity $440,000 $300,000