Effect of Financing on Earnings per Share

Miller Co., which produces and sells skiing equipment, is financed as follows:

Bonds payable, 10% (issued at face amount)	$2,000,000
Preferred $2 stock, $20 par	2,000,000
Common stock, $25 par	2,000,000

Income tax is estimated at 40% of income.

Determine the earnings per share on common stock, assuming that the income before bond interest and income tax is (a) $980,000, (b) $1,180,000, and (c) $1,380,000.

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

a. Earnings per share on common stock $

b. Earnings per share on common stock $

c. Earnings per share on common stock $