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    Earnings per share

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    XYZ, Inc. ended 2007 with a net profit before taxes of $300,000. The company is subject to a 40% tax rate and must pay $40,000 in preferred stock dividends before distributing any earnings on the 90,000 shares of common stock currently
    outstanding. XYZ, Inc. had earnings per share in 2007 of:
    a. $3.33
    b. $1.56
    c. $2.00
    d. None of the above

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    https://brainmass.com/business/accounting/178860

    Solution Preview

    XYZ, Inc. ended 2007 with a net profit before taxes of $300,000. The company is subject to a 40% tax rate and must pay $40,000 in preferred stock dividends before ...

    Solution Summary

    The solution calculates Earnings per share given net profit, tax rate, preferred stock dividends , number of outstanding shares of common stock

    $2.19

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