Reference no: EM132619691

Question - Presented below is information related to Starr Company.

1. Net Income [including a discontinued operations gain (net of tax) of $112,000] $318,500

2. Capital Structure.

a. Cumulative 5% preferred stock, $100 par, 6,100 shares issued and outstanding $610,000.

b. $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 $1,000,000.

c. 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 $236,000 or more, 60,000 additional shares would be issued to Oslo stockholders next year. Oslo's net income for the current year was $2,600,000.

3. Other Information

a. Average market price per share of common stock during entire year $30

b. Income tax rate 30%

Required -

1. What is the Computed weighted average shares outstanding.

2. What is the Computed earnings per share for the current year

Basic earnings per share

Diluted earnings per share