The Mountain Range Railway Company operates a regional railroad in the states of Colorado,New Mexico,and Arizona.Mountain Range reported the following information (dollar amounts in thousands)in its December 31,2014,consolidated statement of income:

Required:
1.Estimate the average number of common shares outstanding for 2014.Assume Mountain Range has outstanding the entire year $108,000 of $2 preferred stock,par value $2.50 (five million shares authorized).The stock is not convertible.Indicate any assumptions you make in your calculations.
2.Does Mountain Range have a simple or complex capital structure?
3.Is Mountain Range required to report earnings per share figures for extraordinary items and discontinued operations,if present,in its income statement?

Question

The Mountain Range Railway Company operates a regional railroad in the states of Colorado,New Mexico,and Arizona.Mountain Range reported the following information (dollar amounts in thousands)in its December 31,2014,consolidated statement of income:
  
Required:
1.Estimate the average number of common shares outstanding for 2014.Assume Mountain Range has outstanding the entire year $108,000 of $2 preferred stock,par value $2.50 (five million shares authorized).The stock is not convertible.Indicate any assumptions you make in your calculations.
2.Does Mountain Range have a simple or complex capital structure?
3.Is Mountain Range required to report earnings per share figures for extraordinary items and discontinued operations,if present,in its income statement?

Quizplus · Accepted Answer

The Answer of The Mountain Range Railway Company operates a regional railroad in the states of Colorado,New Mexico,and Arizona.Mountain Range reported the following information (dollar amounts in thousands)in its December 31,2014,consolidated statement of income:
  
Required:
1.Estimate the average number of common shares outstanding for 2014.Assume Mountain Range has outstanding the entire year $108,000 of $2 preferred stock,par value $2.50 (five million shares authorized).The stock is not convertible.Indicate any assumptions you make in your calculations.
2.Does Mountain Range have a simple or complex capital structure?
3.Is Mountain Range required to report earnings per share figures for extraordinary items and discontinued operations,if present,in its income statement?

The Mountain Range Railway Company Operates a Regional Railroad in the States