(Calculating earnings per share, LO 2, 3, 6) For the year ended September 30, 2004 Queylus Inc. (Queylus) reported net income of $250,000. On September 30, 2003, Queylus had the following capital stock outstanding:

Preferred stock, no par, $5 annual dividend, cumulative, authorized 25,000 shares outstanding $ 250,000 Common stock, no par, authorized 200,000 issued and outstanding —_ 1,000,000 On January 31, 2004 Queylus issued 20,000 common shares for $160,000 and on April 30, 2004 it issued 25,000 common shares for $250,000.

Required:

a. Calculate Queylus’s basic earnings per share for the year ended September 30, 2004.

b. How much of a dividend should Queylus’s shareholders expect to receive in 2004?