Farah Snack Co. has earnings after taxes of $150,000. Interest expense for the year was $20,000;...

  

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Farah Snack Co. has earnings after taxes of $150,000. Interest expense for the year was $20,000; preferred dividends paid were $20,000; and common dividends paid were $30,000. Taxes were $22,500. The firm has 100,000 shares of common stock outstanding. Determine the Earnings per share on the common stock. Hint: preferred stock dividends are not considered available to common share holders. Show all work (display all the variables used in your formulas, and/or detail all steps used in determining the calculation)! Farah Snack Co. has earnings after taxes of $150,000. Interest expense for the year was $20,000; preferred dividends paid were $20,000; and common dividends paid were $30,000. Taxes were $22,500. The firm has 100,000 shares of common stock outstanding. Determine the Earnings per share on the common stock. Hint: preferred stock dividends are not considered available to common share holders. Show all work (display all the variables used in your formulas, and/or detail all steps used in determining the calculation)!

Answer rating: 100% (QA)

To calculate the Earnings per Share EPS on common stock we will use the formula EPS Earnings After T... View the full answer