The Alford Group had 202,000 shares of common stock outstanding at January 1, 20
ID: 2360184 • Letter: T
Question
The Alford Group had 202,000 shares of common stock outstanding at January 1, 2011. The following activities affected common shares during the year. There are no potential common shares outstanding.2011
Feb. 28 Purchased 6,000 shares of treasury stock.
Oct. 31 Sold the treasury shares purchased on February 28.
Nov. 30 Issued 24,000 new shares.
Dec. 31 Net income for 2011 is $400,000.
2012
Jan. 15 Declared and issued a 2-for-1 stock split.
Dec. 31 Net income for 2012 is $400,000.
Required:
(1) Determine the 2011 EPS. (Round your answer to 2 decimal places. Omit the "$" sign in your response.
EPS in 2011 $
(2) Determine the 2012 EPS. (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
EPS in 2012 $
(3) At what amount will the 2011 EPS be presented in the 2012 comparative financial statements? (Round your answer to 2 decimal places. Omit the "$" sign in your response.)
2011 EPS in the 2012 comparative financial statements $
Explanation / Answer
(1) For 2011 The EPS is = Net income/No. Shares In 2011, Net income is $400,000 No. Shares is 24,000 EPS for 2011, = $400,000/24,000 = $16.67 (2) For 2012 The EPS is = Net income/No.of Shares In 2012, Net income is $400,000. In 2012 Stock split is there, so the no.of Shares will be doubled. No. of shares = 11.5/12*2*24,000 = 46,000 EPS for 2012, = $400,000/46,000 = $8.69 (3) $16.67, 2011 EPS is presented in 2012 Financial statements.Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.