Henriksen Co., which produces and sells biking equipment, is financed as follows: Bonds payable, 5% (issued at

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Henriksen Co., which produces and sells biking equipment, is financed as follows:

Bonds payable, 5% (issued at face amount) ........... $6,000,000
Preferred $2.00 stock, $100 par ................................. 3,000,000
Common stock, $25 par .............................................. 5,000,000

Income tax is estimated at 40% of income.

Determine the earnings per share of common stock, assuming that the income before bond interest and income tax is 

(a) $900,000, 

(b) $1,100,00, and 

(c) $1,500,000.

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Accounting

ISBN: 9781337902687

28th Edition

Authors: Carl S. Warren, Christine Jonick, Jennifer Schneider

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