Question
Information for Arnold Co. is as follows for the year ended June 30, 2019: 1. Net income after a discontinued operation after tax gain of
Information for Arnold Co. is as follows for the year ended June 30, 2019: 1. Net income after a discontinued operation after tax gain of $50,000 was $500,000. 2. At July 1, 2018, the company had 20,000, $6 cumulative preferred shares outstanding. Each preferred share is convertible into 4 common shares. Also at July 1, 2018 the company had 150,000 common shares outstanding. 3. 30,000 common shares were issued on March 1, 2019. 4. Warrants were outstanding throughout the fiscal year for the purchase of 10,000 common shares for $20 each. 5. On January 1, 2019 the company issued a $500,000, 8% bond. The bond is convertible into 20 common shares for each $1,000 bond. 6. The following dividends were declared during the year: Preferred shares - $6.00 cash dividend per share Common shares - $1.50 cash dividend per share These dividends will be distributed on July 15, 2019. 7. The company has a 28% tax rate. 8. The common shares had an average market price of $25 per share throughout the year. Required: Calculate the necessary earnings per share figures to be disclosed on the financial statements for the year ended June 30, 2019.
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