Question One

Decks net income (after-tax) for the year ended December 31, 2023 is $2,500,000.

Decks had 2,200,000 common shares issued and outstanding on January 1, 2023. During 2023, the following events occurred:

Feb 1, 2023	Issued a 2 for 1stock split
Apr 1, 2023	Issued 200,000 additional common shares
June 30, 2023	Issued a 5% stock dividend
August 31, 2023	Acquired 30,000 common shares and retired them

Instructions

Calculate basic earnings per share for 2023.

Beginning Bal	Jan to Feb 1	2,200,000	1.05*2	1/12	385,000
	Feb to

The average share price for Decks common shares during 2023 and the share price at December 31, 2023 was $12 per share.

For all of 2023, there were 30,000, $3, cumulative preferred shares outstanding. These preferred shares are each convertible into 10 common shares (adjusted for the stock dividend) at the option of the holder. None have been converted by December 31, 2023. The preferred share dividend was not declared in 2023.

For all of 2023, there were $1,200,000 of 6% convertible bonds outstanding. These bonds had been issued at par. Each $1,000 of bonds is convertible into 100 common shares at the option of the holder. None have been converted by December 31, 2023.

The income tax rate is 25%.

Decks had written/sold options on its common stock in 2023. The holders of the options can buy, from Bombardier, 35,000 common shares of Bombardier common shares at $10 per share. No options have been exercised by December 31, 2023.

Required:

Calculate basic Earnings Per Share (EPS) Round to the nearest cent.