Staples and OfficeMax compete in the retail office supply business. OfficeMax had a net income of $87 million for a recent year, whereas Staples had a net income of $985 million. OfficeMax had preferred dividends of $2 million. Staples had no preferred shares outstanding. The issued and outstanding common shares for each company were as follows:

Common Shares

(in millions)

OfficeMax ..........................224

Staples ..............................694

a. Determine the earnings per share for each company.

b. Evaluate the relative profitability of the two compa