Problem 16-06 Pronghorn Corporation is preparing the comparative financial statements for the annual report to its shareholders for fiscal years ended May 31, 2020, and May 31, 2021. The income from operations for the fiscal year ended May 31, 2020, was $1,819,000 and income from continuing operations for the fiscal year ended May 31, 2009 an income from continuing operations to distupca 2021, was $2,469,000. In both years, the company incurred a 10% interest expense on $2,394,000 of debt, an obligation that requires interest-only payments for 5 years. The company experienced a loss from discontinued operations of $620,000 on February 2021. The company uses a 20% effective tax rate for income taxes. The capital structure of Pronghorn Corporation on June 1, 2019, consisted of 986,000 shares of common stock outstanding and 20,600 shares of $50 par value, 6%, 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, 2019, Pronghorn sold an additional 483,000 shares of the common stock at $20 per share. Pronghorn distributed a 20% stock dividend on the common shares outstanding on January 1, 2020. On December 1, 2020, Pronghorn was able to sell an additional 832,000 shares of the common stock at $22 per share. These were the only common stock transactions that occurred during the two fiscal years. Your answer is correct. Identify whether the capital structure at Pronghorn Corporation is a simple or complex capital structure. Simple Capital Structure Determine the weighted average number of shares that Pronghorn Corporation would use in calculating earnings per share for the fiscal year ended: Weighted average number of shares (1) May 31, 2020 1569600 (2) May 31, 2021 2178800 Prepare, in good form, a comparative income statement, beginning with income from operations, for Pronghorn Corporation for the fiscal years ended May 31, 2020, and May 31, 2021. This statement will be included in Pronghorn's annual report and should display the appropriate earnings per share presentations. (Round earnings per share to 2 decimal places, e.g. $1.55.) PRONGHORN CORPORATION Comparative Income Statement For Fiscal Years Ended May 31, 2020 and 2021 2020 2021 Interest Expense 239400 239400 M Income From Operations 1819000) 2469000 TIncome Before Taxes T 1579600 1609600 Income Taxes T 315920 321920 | Income From Continuing Operations Loss From Discontinued Operations Net Income / (Loss) Earnings per share: TIncome From Continuing Operations Loss From Discontinued Operations Net Income / (Loss)