Pearl Corporation is preparing the comparative financial statements for the annual report to its shareholders for fiscal years ended May 31, 2020, and May 31, 2021. The income from operations for the fiscal year ended May 31, 2020, was $1,712,000 and income from continuing operations for the fiscal year ended May 31, 2021, was $2,500,000. In both years, the company incurred a 10% interest expense on $2,322,000 of debt, an obligation that requires interest-only payments for 5 years. The company experienced a loss from discontinued operations of $605,000 on February 2021. The company uses a 20% effective tax rate for income taxes. The capital structure of Pearl Corporation on June 1, 2019, consisted of 1,039,000 shares of common stock outstanding and 19,500 shares of $50 par value, 5%, cumulative preferred stock. There were no preferred dividends in arrears, and the company had not issued any convertible securities, options, or warrants. On October 1, 2019, Pearl sold an additional 485,000 shares of the common stock at $20 per share. Pearl distributed a 20% stock dividend on the common shares outstanding on January 1, 2020. On December 1, 2020, Pearl was able to sell an additional 780,000 shares of the common stock at $22 per share. These were the only common stock transactions that occurred during the two fiscal years.

Prepare, in good form, a comparative income statement, beginning with income from operations, for Pearl Corporation for the fiscal years ended May 31, 2020, and May 31, 2021. This statement will be included in Pearls annual report and should display the appropriate earnings per share presentations. (Round earnings per share to 2 decimal places, e.g. $1.55.)

Your Answer Correct Answer (Used) Your answer is correct Identify whether the capital structure at Pearl Corporation is a simple or complex capital structure. Simple Capital Structure e Textbook and Media Solution Attempts: 2 of 2 used (b) Your Answer Correct Answer (Used) Determine the weighted average number of shares that Pearl Corporation would use in calculating earnings per share for the fiscal year ended: Weighted-average number of shares (1) May 31, 2020 1,634.800 (2) May 31, 2021 2.218.800 (c) Prepare, in good form, a comparative income statement, beginning with income from operations, for Pearl Corporation for the fiscal years ended May 31, 2020, and May 31, 2021. This statement will be included in Pearl's annual report and should display the appropriate earnings per share presentations. (Round earnings per share to 2 decimal places, eg. $1.55.) PEARL CORPORATION Comparative Income Statement For Fiscal Years Ended May 31, 2020 and 2021 2020 2021 $ $ $ $ $