Reporting EPS: Discontinued Operations

Taft Corporation had after-tax income from continuing operations of $14.1 million for 2020. Taft also reported a $2.58 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following.

• Preferred stock: 210,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued in 2020. No dividends were declared in the current year.
• Common stock: Outstanding January 1, 2020, 4,271,865 shares, $1 par. Dividends of $1.00 per share were declared and paid in 2020. On July 1, 2020, a three-for-one stock split was declared and the shares were issued.

Required

a. What type of capital structure does Taft have (simple or complex)?

Answer: Simple structure or Complex structure

b. Compute relevant EPS amounts.

Note: Round earnings per share amounts to two decimal places.

	Income from Continuing Operations Available to Common Stockholders	Weighted Avg. Common Shares Outstanding	Per Share
Answer: Basic EPS or Diluted EPS	Answer	Answer	Answer

	Net Income Available to Common Stockholders	Weighted Avg. Common Shares Outstanding	Per Share
Answer: Basic EPS or Diluted EPS	Answer	Answer	Answer

c. Show the EPS presentation for financial reporting.

Answer: Basic EPS or Diluted EPS

Income from continuing operations	Answer
Loss from discontinued operations, net of tax	Answer
Net income	Answer