Ryan Company reports net income of $5,125 for the year ended December 31, 2007, its first year
Question:
Ryan Company reports net income of $5,125 for the year ended December 31, 2007, its first year of operations. On January 3, 2007, the company issued 9,000 shares of common stock. On August 1, 2007 it issued an additional 3,000 shares of stock, resulting in 12,000 shares outstanding at year-end.
During 2008 Ryan Company earned net income of $16,400. It issued 2,000 additional shares of stock on March 3, 2008 and declared and issued a two-for-one stock split on November 3, 2008, resulting in 28,000 shares outstanding at year-end.
During 2009 Ryan Company earned net income of $23,520. The only common stock transaction during 2009 was a 20% stock dividend issued on July 2, 2009.
Required
1. Compute the basic earnings per share that would be disclosed in the 2007 annual report.
2. Compute the 2007 and 2008 comparative basic earnings per share that would be disclosed in the 2008 annual report.
3. Compute the 2007, 2008, and 2009 comparative basic earnings per share that would be disclosed in the 2009 annual report.
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...
Step by Step Answer:
1 2007 annual report 2007 basic earnings per share 050 2007 computations 512510250 050 9000 x 712 ...View the full answer
Intermediate Accounting
ISBN: 978-0324300987
10th Edition
Authors: Loren A Nikolai, D. Bazley and Jefferson P. Jones
