ACCT 2001 Chapter : Chapter 11 Solutions
Document Summary
Earnings per share of common stock (720* shares outstanding): Discontinued operations, net of tax ( / 720) . Income before eo item and cumulative effect of accounting change, net of tax ( / 720) . Eo gain, net of tax ( / 720) *917 shares issued 197 treasury shares = 720 shares outstanding. (15-25 min. ) These transactions increased stockholders" equity and assets and thereby strengthened the positions of the company"s creditors. (20-30 min. ) Income before extraordinary item and cumulative effect of change in depreciation method Extraordinary loss, ,000, less income tax saving of ,000 Income before extraordinary item and cumulative effect of change in depreciation method. Net income [(,000 ,000) / 24,000] . 04. Evaluation: the year ended sept. 30, 20x3 was a bad year. Otis"s managers fell short of their goal of earning income from continuing operations equal to 10% of sales (,000 / ,000.
