Sheridan Travel had earnings after taxes of $600,000 in 2014 with 300,000 common shares outstanding. On January

Question:

Sheridan Travel had earnings after taxes of $600,000 in 2014 with 300,000 common shares outstanding. On January 1, 2015, the firm issued 40,000 new common shares. There is a 25 percent increase in after tax earnings resulting from the issue of the new shares.
a. Compute EPS for the year 2014.
b. Compute EPS for the year 2015.

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