calculate Basic Earnings Per Share and indicate whether it increases/reduces

Question #4 F/S Analysis 15 marks 35 minutes Condensed statement of financial position and comprehensive income statement data for Calculator Ltd. follow: CALCULATOR LTD. Statement of Financial Position As at December 31 2018 2017 $ 70,000 $ 65,000 95,000 90,000 130,000 125,000 24,000 23,000 45,000 40,000 390,000 305.000 $754,000 $648,000 Assets Cash Accounts receivable (net) Inventory Prepaid expenses Long-term investments Property, plant, and equipment (net) Total assets Liabilities and Shareholders' Equity Liabilities Accounts payable Accrued liabilities Bank loan payable (current) Bonds payable, due 2025 Total liabilities Shareholders' equity Common shares (20,000 shares issued) Retained earnings Accumulated other comprehensive loss Total shareholders' equity Total liabilities and shareholders' equity $ 45,000 $ 42,000 30,000 40,000 110,000 100,000 200.000 150.000 385,000 332,000 200,000 200,000 172,000 116,000 (3.000) -0- 369,000 316,000 $754,000 $648,000 CALCULATOR LTD. Statement of Comprehensive Income Year Ended December 31 Sales Cost of goods sold Gross profit Operating expenses Income from operations Interest expense Income before income tax Income tax expense Net income Other comprehensive loss Total comprehensive income 2018 $900,000 600,000 300,000 184,000 116,000 30,000 86,000 22.000 64,000 (3.000) $ 61,000 2017 $840,000 575,000 265,000 160,000 105,000 20,000 85,000 20,000 65,000 -0- $ 65,000 Additional information: 1. The allowance for doubtful accounts was $4,000 in 2017 and $5,000 in 2018. 2. Accounts receivable at the beginning of 2017 were $88,000, net of an allowance for doubtful accounts of $3,000 3. Inventory at the beginning of 2017 was $115,000. 4. Total assets at the beginning of 2017 were $630,000 5. Total current liabilities at the beginning of 2017 were $180,000 6. Total liabilities at the beginning of 2017 were $371,000. 7. Shareholders' equity at the beginning of 2017 was $259,000. 8. Seventy-five percent of the sales were on account. 9. Net cash provided by operating activities was $85,000 in 2017 and $96,000 in 2018. 10. Net capital expenditures were $50,000 in 2017 and $125,000 in 2018. 11. In each of 2017 and 2018, $8,000 of dividends were paid to the common shareholders