Answer:
1. $2.5 Per Share
2. $0.9375 per share
3. $1.25
Explanation:
According to the scenario, computation of the given data are as follow:-
1. EPS 2018
Earning Per Share(EPS) = Net Income ÷ Weighted Average Outstanding Share of Common Stock
2018:- Weighted Average Outstanding Share of Common Stock = (320,000 × 12 ÷ 12) - (24,000 × 10÷12) + (24,000 × 2÷ 12) + (96000 × 1÷12)
= 320,000 - 20,000 + 4,000 + 8,000 =312,000 shares
2018 Net Income = $780,000
Earning Per Share ( EPS ) 2018 = $780,000 ÷ 312,000 = $2.5 Per Share
2. 2019 EPS:-
Common Stock Share at the Beginning of 2019 =320,000 - 24,000 + 24,000 + 96,000 = 416,000 shares
2019:- Weighted Average Outstanding Share of Common Stock = 416,000 × 2 = 832,000
2019 Net Income = $780,000
EPS = $780,000 ÷ 832,000 = $0.9375 per share
3. The 2018 EPS Be Presented in 2019 Comparative Financial Statement = Net Income ÷ (Weighted Average Outstanding Shares Of Common Stock For 2018 × Stock) )
= $780,000 ÷ (312,000 × 2)
= $780,000 ÷ 624,000
= $1.25
