Reference no: EM132405218

Question

Presented below is information related to Starr Company.

Net Income [including a discontinued operations gain (net of tax) of $54,000]$200,5002.Capital Structurea.Cumulative 5% preferred stock, $100 par, 6,500 shares issued and outstanding$650,000b.$10 par common stock, 74,000 shares outstanding on January 1.

On April 1, 40,000 shares were issued for cash. On October 1, 16,000 shares were purchased and retired.$1,000,000c.On January 2 of the current year, Starr purchased Oslo Corporation. One of the terms of the purchase was that if Oslo net income for the following year is $242,000 or more, 50,000 additional shares would be issued to Oslo stockholders next year.

Oslo's net income for the current year was $2,600,000.3.Other Informationa.Average market price per share of common stock during entire year$30b.Income tax rate30%

Compute weighted average shares outstanding.

Compute earnings per share for the current year.