At July 1, 2020, Peters Corporation had the following share capital: *The preferred dividends are 2 years in arrears.
On January 1, 2021, the board of directors declared and paid a 15% common stock dividend when the market price of common shares was $ 23.50. On April 1, 2021, the company sold an additional 1,000,000 common shares for proceeds of $ 5,680,000. The corporation earned $ 722,000 during the year and paid $ 186,000 in dividends.
Instructions
a). Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the company paid $ 186,000 in cash dividends.
b) Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the company paid $ 186,000 in cash dividends but there were no preferred dividends in arrears.
c) Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the preferred dividends are noncumulative and $ 50,000 in total cash dividends were paid during the year.

Question

At July 1, 2020, Peters Corporation had the following share capital:  *The preferred dividends are 2 years in arrears.
On January 1, 2021, the board of directors declared and paid a 15% common stock dividend when the market price of common shares was $ 23.50. On April 1, 2021, the company sold an additional 1,000,000 common shares for proceeds of $ 5,680,000. The corporation earned $ 722,000 during the year and paid $ 186,000 in dividends.
Instructions 
a). Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the company paid $ 186,000 in cash dividends.
b) Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the company paid $ 186,000 in cash dividends but there were no preferred dividends in arrears.
c) Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the preferred dividends are noncumulative and $ 50,000 in total cash dividends were paid during the year.

Quizplus · Accepted Answer

The Answer of At July 1, 2020, Peters Corporation had the following share capital:  *The preferred dividends are 2 years in arrears.
On January 1, 2021, the board of directors declared and paid a 15% common stock dividend when the market price of common shares was $ 23.50. On April 1, 2021, the company sold an additional 1,000,000 common shares for proceeds of $ 5,680,000. The corporation earned $ 722,000 during the year and paid $ 186,000 in dividends.
Instructions 
a). Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the company paid $ 186,000 in cash dividends.
b) Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the company paid $ 186,000 in cash dividends but there were no preferred dividends in arrears.
c) Calculate Peters Corporation's earnings per share for the year ended June 30, 2021, assuming the preferred dividends are noncumulative and $ 50,000 in total cash dividends were paid during the year.

At July 1, 2020, Peters Corporation Had the Following Share