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Example p 1 5 - 6 Milton corporation is preparing the comparative financial statements for the annual report to shareholders for fiscal year ended May
Example p
Milton corporation is preparing the comparative financial statements for the annual report to shareholders for fiscal year ended May and May the income from operations for the fiscal year ended May was $ An
income from continuing operations for the fiscal year ended May was $ In both years, the company incurred a interest expense on $ of debt, an obligation that requires interest only payments for five years. The company experienced a loss from discounted operations of $ in February The company uses a effective tax rate for income taxes.
The capital structure of Milton corporation on June consisted of million shares of common stock outstanding and shares of $ par value, cumulative preferred stock. There were no preferred dividends in arrears, and the company has not issued any convertible securities options, or warrents.
On October Milton sold an additional shares of the Commons stock at $ per share. Melon distributed at stock dividend on the common shares outstanding on January On December Milton was able to sell an addition of shares of common stock at $ per share. These were the only common stock trans actions that occurring the two fiscal years.
A Identify whether the capital structure at Milton corporation is a simple or complex capital structure and explain why
B Determine the weighted average number of shares that Milton corporation would use in calculating earnings per share for the fiscal year ended
a
b
C Prepare a good form, a comparative income statement, beginning with income from operations, for Milton corporation for the fiscal year ended May and May This statement will be included nuns annual report and to display the appropriate earnings per share presentations.
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