Effect of Financing on Earnings per Share

Domanico Co., which produces and sells biking equipment, is financed as follows:

Bonds payable, 8% (issued at face amount) $10,000,000

Preferred $5 stock, $10 par 10,000,000

Common stock, $20 par 10,000,000

Income tax is estimated at 40% of income.

Determine theearnings per share of common stock, assuming that the income beforebondinterest and income tax is (a) $10,500,000, (b) $11,800,000, and (c) $13,000,000.

Enter answers in dollars and cents, rounding to the nearest whole cent.

a.Earnings per share on common stock $

b.Earnings per share on common stock $

c.Earnings per share on common stock $