Titan Ltd. provides the following information for calendar 2020 1. Net income $ 420,000 2. Capital Structure (December 31, 2020) a) $ 6 preferred shares, no par value, cumulative, $ 500,000 6,000 shares authorized, 5,000 shares issued and outstanding b) $ 8 preferred shares, no par value, non-cumulative, $ 600,000 10,000 shares authorized, 6,000 shares issued and outstanding c) Common shares, 510,000 shares issued and outstanding $ 1,000,000 At January 1, 2020, Titan Ltd. had 300,000 common shares outstanding. On March 1, the company issued 45,000 new shares to raise additional capital. On July 1, the company declared and issued a 2 for 1 stock split. On October 1, the company purchased on the open market 180,000 of its own shares and retired them. Titan had one-year dividends in arrears at the beginning of 2020 and declared total dividends of $208,000 during 2020.

Instructions

a) Calculate earnings available to common shareholders for 2020.

b) Compute the weighted average number of common shares outstanding for 2020.

c) Compute the basic earnings per share for 2020.

d) Had Titan declared no dividends in 2020, would its earnings per share have been affected? If yes, how? (Show your computations) Had Titan declared no dividends during 2020, only the dividends for the cumulated preferred shares should be subtracted to determine the earnings available to common shareholders.