ended May $31,2025,$ and May $31,2026.$ The income from operations for the fiscal year ended May $31,2025,$ was $$1,712,000$ and

income from continuing operations for the fiscal year ended May $31,2026,$ was $$2,500,000.$ In both years, the company incurred

a $10\%$ interest expense on $$2,322,000$ of debt, an obligation that requires interest$-$only payments for $5$ years. The company

experienced a loss from discontinued operations of $$605,000$ in February $2026.$ The company uses a $20\%$ effective tax rate for income

taxes.

The capital structure of Marigold Corporation on June $1,2024,$ consisted of $1,039,000$ shares of common stock outstanding

and $19,500$ shares of $$50$ par value, $5\%,$ cumulative preferred stock. There were no preferred dividends in arrears, and the company

had not issued any convertible securities$,$ options, or warrants.

On October $1,2024,$ Marigold sold an additional $485,000$ shares of the common stock at $$20$ per share. Marigold distributed a $20\%$

stock dividend on the common shares outstanding on January $1,2025.$ On December $1,2025,$ Marigold was able to sell an

additional $780,000$ shares of the common stock at $$22$ per share. These were the only common stock transactions that occurred

during the $2$ fiscal years.

$($a$)$

Your answer is correct.

Identify whether the capital structure at Marigold Corporation is a simple or complex capital structure.

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$($b$)$

Your answer is incorrect.

Determine the weighted$-$average number of shares that Marigold Corporation would use in calculating earnings per share for the

fiscal year ended:

Weighted$-$average number of shares

May $31,2025$

May $31,2026$

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$($c$)$

Your answer is partially correct.

Prepare, in good form, a comparative income statement, beginning with income from operations, for Marigold Corporation for the

fiscal years ended May $31,2025,$ and May $31,2026.$ This statement will be included in Marigold's annual report and should display

the appropriate earnings per share presentations. $($Round earnings per share to $2$ decimal places, e$.$g$.1\mathrm{.}55.)$

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