MGAB02H3 Lecture 6: ~$cture notes ch 6 accounting
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For the year ended December 31, 2016, Joey Co. reported NetIncome of $800,000. At January 1, 2016 the company had 900,000shares of common stock outstanding. Joey Co. also had $1,000,000 of6% cumulative preferred stock. No preferred dividends were paid in2016 and the preferred stock is non-convertible. The followingchanges in the number of shares occurred during 2016:
April1: Sold60,000 shares of common stock.
May 31: Declared and Distributed a 10% Stock Dividend
July1: Issued 72,000 shares of common stock
Required:
1. | Compute Joey Coâs earnings per share for the year ended December31, 2016. |
2. | Given the facts as presented above, Joey Co would have to reportDiluted EPS at 12/31/2016. TRUE or FALSE [Circle One] |
3) | Explain your answer in part 2 above (brief short answer) |