Plymouth Corporation's net income for the current $420,000. The corporation had outstanding 4,500 shares of 15%, $100 par value nonconvertible preferred stock and 15,000 shares of $10 par value common stock. No shares were issued or retired during the year. The amount of income to be used in the basic calculation of earnings per share is:

Question

Quizplus · Accepted Answer

The income for EPS calculation is net income minus preferred dividends. Preferred dividends = 4,500 shares * $100 * 15% = $67,500. So, $420,000 - $67,500 = $352,500.

Plymouth Corporation's Net Income for the Current $420,000