After returning from vacation, the accountant of Online Hearing Inc. was dismayed to discover that the income statement for the year ended December 31, 2014, was prepared incorrectly. All amounts included in the statement are before tax (assume a rate of 40%). The company had 200,000 common shares issued and outstanding throughout the year as well as 70,000 $1.00 cumulative preferred shares. Dividends had not been paid for the past two years (2012 and 2013). Retained earnings at December 31, 2013, were $171,000.

Required
Prepare a corrected income statement, using a multi-step format, including earnings per share information. Round all earnings per share calculations to the nearest wholecent.

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Online Hearing Inc. Income Statement December 31, 2014 Revenues: Gain on sale of discontinued operation (pre-tax) .120,000 22,500 Operating income on discontinued operation (pre-tax) . 318,000 $1,360,500 Expenses Cost of goods sold. $240,000 90,000 7,000 40,000 47,500 Loss on disposal of plant assets (pre-tax). 424,500 $ 936,000 4.68 Earnings per share . . .