Question

The following information is available for Bradshaw Corporation and Newell Corporation:Bradshaw CorporationNewell Corporation(in millions)2014201320142013Preferred dividends2510030Net income500480490520Shares outstanding at the end of the year200180150200Shares outstanding at the beginning of the year180150200220Based on this information, what is the amount of Bradshaw's earnings per share (rounded to two decimals) for 2014?A)$2.76B)$2.50C)$1.25D)$1.32B)$2.50

Answer 1

Answer:

D)$1.32

Explanation:

For computing the earning per share, we need to apply the formula which is shown below:

= (Net income - preference dividend) ÷ (average of outstanding shares)

where,

Average of outstanding shares = (Beginning balance of outstanding shares + ending balance of outstanding shares) ÷ 2

The other items value will remain the same  

Now put these values to the above formula  

So, the value would equal to

= ($500,480 - 251,003) ÷ {(200,180 shares +180,150 shares ) ÷ 2}

=  $249477 ÷ 190165 shares

= $1.32