Answer:
Common Stock
Poison Corp's Common stock = $120,000 / $10 = 12,000 shares
Snake Co's Common stock = $100,000 / $10 = 10,000 shares
Poison Corp owned Common stock in Snake Co. = 10,000 shares *70% = 7,000 shares
Preferred Stock Dividend
Poison Corp = $100,000 * 9% = $9,000
Snake Co = $56,000 * 10%= $5,600
Net Income which is the Adjusted Net income in absence of any information:
Poison Corp - $65,000
Snake Co - $52,000
Subsidiary Basic EPS = (Adjusted Net Income of Subsidiary - Preferred Stock Dividend ) / Subsidiary Common shares outstanding
Therefore Basic EPS of Snake Co. = (52,000 - 5,600) / 10,000 shares
= $4.64
Consolidated Basic EPC = [ (Parent Adjusted Net Income generated Internally - Parent Preferreed Stock Dividend) + (Parent Owned Subsidiary Common shares * Subsidiary EPS) ] / Parent Common shares outstanding
Therefore Consolidated EPS of Poison Corp = [(65,000 - 9,000) + (7,000 shares * 4.64)} / 12,000 shares
= (56,000 + 32,550) / 12,000 shares
= $7.3781
=$7.38