Blanco Inc. has a net income of $300000 for 2017 and there are 200000 weighted-average shares of common stock outstanding. Dividends declared and paid during the year amounted to $40000 on the preferred stock and $60000 on the common stock. The earnings per share for 2017 is

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Quizplus · Accepted Answer

Earnings per share (EPS) is calculated as (Net Income - Preferred Dividends) / Weighted Average Shares Outstanding. Here, EPS = ($300,000 - $40,000) / 200,000 = $1.30.