Reference no: EM131769453
1.(EPS: Simple Capital Structure) On January 1, 2014, Bio Industries had stock outstanding as follows.
8% Noncumulative preferred stock, $100 par value, issued and outstanding 250,000 shares $25,000,000 Common stock, $1 par value, issued and outstanding 600,000 shares 600,000
To acquire the net assets of three smaller companies, Bio issued an additional 600,000 common shares. The acquisitions took place as follows.
Date of Acquisition Shares Issued
|
MicroBio February 1, 2014
|
200,000
|
|
BioTech June 1, 2014
|
80,000
|
|
SuperBio November 1, 2014
|
320,000
|
On December 31, 2014, Bio recorded net income of $9,862,000 before taxes. No dividends on the common or preferred were declared during 2014.
Instructions
(a) Assuming a 40% tax rate, compute the earnings per share data that should appear on the financial state ments of Bio Industries as of December 31, 2014.
(b) Prepare the EPS footnote required for 2014.