Question
Computing EPS: Simple Capital Structure and Net Loss Grace Corp. had 200,000 common shares outstanding as of January 1, and declared a 1-for-2 reverse stock
Computing EPS: Simple Capital Structure and Net Loss
Grace Corp. had 200,000 common shares outstanding as of January 1, and declared a 1-for-2 reverse stock split on March 31. In addition, the company bought 10,000 shares for the treasury on August 31, and 4,000 shares of stock were issued on November 1 in exchange for legal services. The company also had 2,000 shares of 5%, $10 par, cumulative, nonconvertible preferred stock outstanding for the year. No common or preferred stock dividends were declared during the year. The company suffered a net loss for the year of $200,000.
Required Compute basic EPS. Note: Round weighted average common shares outstanding to the nearest whole number. Note: Use a negative sign with a loss.
Calculation of Weighted Shares Outstanding:
Weighted Avg. Shares Inclusive Dates Outstanding Jan. - Mar. Apr. - Aug. Sept. - Oct. Nov. - Dec.
Numerator Denominator Per Share Basic EPS / =
Computing EPS: Simple Capital Structure and Net Loss
Grace Corp. had 200,000 common shares outstanding as of January 1, and declared a 1-for-2 reverse stock split on March 31. In addition, the company bought 10,000 shares for the treasury on August 31, and 4,000 shares of stock were issued on November 1 in exchange for legal services. The company also had 2,000 shares of 5%, $10 par, cumulative, nonconvertible preferred stock outstanding for the year. No common or preferred stock dividends were declared during the year. The company suffered a net loss for the year of $200,000.
Required Compute basic EPS. Note: Round weighted average common shares outstanding to the nearest whole number. Note: Use a negative sign with a loss.
Calculation of Weighted Shares Outstanding:
| Weighted | ||
|---|---|---|
| Avg. Shares | ||
| Inclusive Dates | Outstanding | |
| Jan. - Mar. | ||
| Apr. - Aug. | ||
| Sept. - Oct. | ||
| Nov. - Dec. | ||
| Numerator | Denominator | Per Share | ||||
|---|---|---|---|---|---|---|
| Basic EPS | / | = |
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Auditing Cases An Active Learning Approach
Authors: Mark S. Beasley, Frank A. Buckless, Steven M. Glover, Douglas F. Prawitt
2nd Edition
9781266566899
