Earnings per share on common stocks
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Ace Company had 200,000 shares of common stock outstanding on December 31, 2008. During the year 2009 the company issued 8,000 shares on May 1 and retired 14,000 shares on October 31. For the year 2009 Ace Company reported net income of $249,690 after a casualty loss of $40,600 (net of tax).
What earnings per share data should be reported at the bottom of its income statement, assuming that
the casualty loss is extraordinary?
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Solution Summary
The solution explains the earnings per share that should be shown in the income statement below net income.
Solution Preview
At the bottom of the income statement the EPS relating income from continuing operations, extraordinary loss and net income would be reported
Income from continuing operations = 249,690+40,600 = $290,290
Extraordinary loss ...
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