8 (2)

Windsor Corporation is preparing the comparative financial statements for the annual report to its shareholders for fiscal years ended May 31, 2020, and May 31, 2021. The income from operations for the fiscal year ended May 31, 2020, was $1,889,000 and income from continuing operations for the fiscal year ended May 31, 2021. was $2,530,000. In both years, the company incurred a 9% interest expense on $2.449.000 of debt an obligation that requires interest-only payments for 5 years. The company experienced a loss from discontinued operations of $606,000 on February 2021. The company uses a 20% effective tax rate for income taxes. The capital structure of Windsor Corporation on June 1, 2019, consisted of 962,000 shares of common stock outstanding and 20,500 shares of $50 par value, 6%, cumulative preferred stock. There were no preferred dividends in arrears, and the company had not issued any convertible securities, options, or warrants. On October 1, 2019, Windsor sold an additional 511.000 shares of the common stock at $20 per share. Windsor distributed a 20% stock dividend on the common shares outstanding on January 1, 2020. On December 1, 2020, Windsor was able to sell an additional 760,000 shares of the common stock at $22 per share. These were the only common stock transactions that occurred during the two fiscal years. Determine the weighted average number of shares that Windsor Corporation would use in calculating earnings per share for the fiscal year ended: Weighted-average number of shares (1) May 31, 2020 1302667 (2) May 31, 2021 1853000 Prepare, in good form, a comparative income statement, beginning with income from operations, for Windsor Corporation for the fiscal years ended May 31, 2020, and May 31, 2021. This statement will be included in Windsor's annual report and should display the appropriate earnings per share presentations. (Round earnings per share to 2 decimal places, es $1.55.) WINDSOR CORPORATION Comparative Income Statement For Fiscal Years Ended May 31, 2020 and 2021 2020 2021 1889000 $ 2530000 Income From Operations (606000) Loss From Discontinued Ooerations 188900 1924000 Income Before Extraordinary Loss 220410) 12204100 Interest Expense $ 1889000 $ LA Income From Operations 2530000 0 (606000) Loss From Discontinued Operations 188900 1924000 Income Before Extraordinary Loss (220410) (220410) Interest Expense 1668590 1703590 Income Before Taxes 80092 81772 Dividends $ Net Income /(Loss) Earnings per share