(Equity transactions, LO 2, 3, 6) The shareholders’ equity section of Fogo Ltd.s balance sheet is shown below:

During fiscal 2005, the following occurred:
i. On January 31, 50,000 common shares were issued for $100,000.
ii. On July 31, 75,000 common shares were issued for $175,000.

iii. Dividends on preferred stock of $50,000 were declared and paid.
iv. Dividends on common stock of $200,000 were declared and paid.
v. Net income for fiscal 2005 was $975,000.
Required:

a. Calculate the weighted-average number of common shares outstanding during the year.

b. Calculate basic earnings per share for the year ended November 30, 2005.

c. Calculate return on shareholders’ equity for the year ended November 30, 2005.

d. Prepare the shareholders’ equity section for Fogo Ltd’s November 30, 2005 balance sheet.

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Fogo Ltd. Extracts from the November 30, 2004 Balance Sheet Shareholders' equity Preferred stock (Authorized 100,000, Outstanding, 25,000) Common stock (Authorized 1,000,000, Outstanding 500,000) Retained earnings Total shareholders' equity $ 625,000 900,000 3,440,000 $4,965,000