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Calculation of EPS, Dividend Payout and Retained Earnings

Please see the attached file.

E14-15
The following financial information is available for Cheney Corporation.

2008 2007
Average common stockholders' equity 1,200,000 900,000
Dividends paid to common stockholders 50,000 30,000
Dividends paid to preferred stockholders 20,000 20,000
Net income 290,000 200,000
Market price of common stock 20 15
The weighted average number of shares of common stock outstanding was 80,000 for 2007 and 100,000 for 2008.
Instructions
Calculate earnings per share and return on common stockholders' equity for 2008 and 2007. (Round earnings per share to 2 decimal places and return to 1 decimal place.)

E14-14
McCoy Corporation has outstanding at December 31, 2008, 50,000 shares of $20 par value, cumulative, 8% preferred stock and 200,000 shares of $5 par value common stock. All shares were outstanding the entire year. During 2008, McCoy earned total revenues of $2,000,000 and incurred total expenses (except income taxes) of $1,200,000. McCoy's income tax rate is 30%.

Step 1: Determine weighted average number of shares
Step 2: Compute preferred dividend paid out during the year
Step 3: Calculate net income
Step 4: Calculate 2008 Earnings per Share

BE14-6
SUPERVALU, one of the largest grocery retailers in the United States, is headquartered in Minneapolis. The following financial information (in millions) was taken from the company's 2005 annual report. Net sales $19,543; net income $386; beginning stockholders' equity $2,210; ending stockholders' equity $2,510. Compute the return on common stockholders' equity ratio. (Round answer to 1 decimal place.)

BE14-7
Fuentes Corporation reported net income of $152,000, declared dividends on common stock of $50,000, and had an ending balance in retained earnings of $360,000. Stockholders' equity was $700,000 at the beginning of the year and $820,000 at the end of the year. Compute the return on common stockholders' equity. (Round answer to 0 decimal places.)

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Solution Preview

Please see the attached file.

E14-15
The following financial information is available for Cheney Corporation.

2008 2007
Average common stockholders' equity 1,200,000 900,000
Dividends paid to common stockholders 50,000 30,000
Dividends paid to preferred stockholders 20,000 20,000
Net income 290,000 200,000
Market price of common stock 20 15
The weighted average number of shares of common stock outstanding was 80,000 for 2007 and 100,000 for 2008.

Instructions
Calculate earnings per share and return on common stockholders' equity for 2008 and 2007.
(Round earnings per share to 2 decimal places and return to 1 decimal place.)

2008 2007
Earnings per Share $2.70 $2.25
Return on Common Sockholders' Equity 23% 20%

E14-14
McCoy Corporation has outstanding at December 31, 2008, 50,000 shares of $20 par value,
cumulative, 8% preferred stock and 200,000 shares of $5 par value common stock. All shares ...

Solution Summary

The attached MS Excel file contains instructions as well as calculations for determining a corporations dividends, retained earnings, and other aspects of income reporting.

$2.19