Calculation of EPS and retained earnings Everdeen Mining, Inc., ended 2019 with net profits before taxes of $ 436 comma 000. The company is subject to a 21 % tax rate and must pay $ 64 comma 000 in preferred stock dividends before distributing any earnings on the 170 comma 000 shares of common stock currently outstanding. a. Calculate Everdeen's 2019 earnings per share (EPS). b. If the firm paid common stock dividends of $ 0.80 per share, how many dollars would go to retained earnings?

Question

contestada

Respuesta :

mltn1980 mltn1980 · Answer 1 · 2019-09-12T06:24:44+02:00

Answer:

A) $ 1,65 are the 2019 EPS

B) $ 144.4400 go to retained earning after paid dividens of 0,80 per share.

Please see details below:

Explanation:

Net Income BEFORE Taxes $436.000

Tax RATE 21% -$91.560

Net Income after Taxes $344.440

Preferred Stock -$64.000

Subtotal $ 280.440 >> 280.440/170.000= $1,65 2019 EPS

Dividends $0,80/Shares: 170.000*0,8= $136.000

Subtotal $ 144.440 >> Retained Earnings

Answer Link