Reference no: EM132734766
Questions -
Q1. Wildhorse Corporation had 94,000 common shares outstanding on December 31, 2019. During 2020, the company issued 11,500 shares on March 1, retired 7,200 shares on July 1, issued a 20% stock dividend on October 1, and issued 16,800 shares on December 1. For 2020, the company reported net income of $376,000 after a loss from discontinued operations of $50,800 (net of tax). The company issued a 2-for-1 stock split on February 1, 2021, and the company's financial statements for the year ended December 31, 2020, were issued on February 28, 2021. Calculate earnings per share for 2020 as it should be reported to shareholders.
Q2. On January 1, 2020, Wildhorse Ltd. had 522,000 common shares outstanding. During 2020, it had the following transactions that affected the common share account:
Feb. 1 Issued 154,000 shares.
Mar. 1 Issued a 20% stock dividend.
May 1 Acquired 174,000 common shares and retired them.
June 1 Issued a 2-for-1 stock split.
Oct. 1 Issued 43,000 shares.
The company's year end is December 31.
a. Determine the weighted average number of shares outstanding as at December 31, 2020.
b. Assume that Wildhorse earned net income of $3,553,000 during 2020. In addition, it had 110,000 of 11%, $100 par, non-convertible, non-cumulative preferred shares outstanding for the entire year. Because of liquidity limitations, however, the company did not declare and pay a preferred dividend in 2020.
Calculate earnings per share for 2020, using the weighted average number of shares determined above.
c. Assume that Wildhorse earned net income of $3,553,000 during 2020. In addition, it had 110,000 of 11%, $100 par, non-convertible, cumulative preferred shares outstanding for the entire year. Because of liquidity limitations, however, the company did not declare and pay a preferred dividend in 2020.
Calculate earnings per share for 2020, using the weighted average number of shares determined above.
d. Assume that Wildhorse earned net income of $3,553,000 during 2020. In addition, it had 110,000 of 11%, $100 par, non-convertible, non-cumulative preferred shares outstanding for the entire year. Because of liquidity limitations, however, the company did not declare and pay a preferred dividend in 2020. Assume that net income included a loss from discontinued operations of $421,000, net of applicable income taxes.
Calculate earnings per share for 2020.