QUESTION 7

1. A companys Dec 31, 2015 equity accounts are shown below:

   Preferred Stock (7%, $100 par, cumulative, 8,000 authorized) $ 400,000

   Common Stock ($10 par, 200,000 shares authorized) 1,000,000

   On April 1, 2015, 25,000 shares of common stock had been issued when the market price of the stock was $15. On August 31, 2015, 30,000 shares of common stock had been issued in exchange for some land when the stock was trading at $18 per share. No new shares of preferred stock were issued during the year. If the company reported net income of $200,000 in 2015, what are the earnings per share? (Round to the nearest cent.)

   	A.	$2.33
   	B.	$2.00
   	C.	$2.71
   	D.	$1.92
   	E.	$1.72