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    makami4's Avatar
    makami4 Posts: 13, Reputation: 1
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    #1

    Oct 5, 2012, 12:19 PM
    Effect of Financing on Earnings per Share-I need help please!
    Effect of Financing on Earnings per Share

    Kelton Co. which produces and sells skiing equipment, is financed as follows:



    Income tax is estimated at 40% of income.

    Determine the earnings per share on common stock, assuming that the income before bond interest and income tax is (a) $10,000,000, (b) $12,000,000, and (c) $14,000,000.

    Enter answers in dollars and cents, rounding to the nearest whole cent.
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 172
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    #2

    Oct 5, 2012, 03:57 PM
    1 this is an incomplete question
    2 we don't provide model answers to assignment questions
    3 tell us what your question is, we like to see your attempts at answering the question
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    makami4 Posts: 13, Reputation: 1
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    #3

    Oct 5, 2012, 07:37 PM
    I'm apologized for the incomplete question. The reason why I ask for help is because I don't have any accounting acknowledgement and this something completely new for me.. I don't expect you give me the answers but I will really appreciate if you can help me the steps to get the right answer since in the textbook is very complicated for me to understand what they say.thanks!
    Effect of Financing on Earnings per Share

    Kelton Co. which produces and sells skiing equipment, is financed as follows:



    Income tax is estimated at 40% of income.

    Determine the earnings per share on common stock, assuming that the income before bond interest and income tax is (a) $10,000,000, (b) $12,000,000, and (c) $14,000,000.

    Enter answers in dollars and cents, rounding to the nearest whole cent.

    a. Earnings per share on common stock $

    b. Earnings per share on common stock $

    c. Earnings per share on common stock $
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 172
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    #4

    Oct 5, 2012, 08:14 PM
    In order to get the earnings per share you need to know the number of shares issued
    It was for this reason I said the question is incomplete, that number isn't included
    Accounting is as much about comprehension as it is about numbers
    Repeating the text doesn't make anything any clearer

    http://www.investopedia.com/terms/e/...#axzz28U9kr6pg

    Reading the text of your question suggests other data is also not included including what ever was in the text box that didn't copy over
    makami4's Avatar
    makami4 Posts: 13, Reputation: 1
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    #5

    Oct 6, 2012, 10:50 AM
    Quote Originally Posted by paraclete View Post
    In order to get the earnings per share you need to know the number of shares issued
    It was for this reason I said the question is incomplete, that number isn't included
    Accounting is as much about comprehension as it is about numbers
    repeating the text doesn't make anything any clearer

    Earnings Per Share (EPS) Definition | Investopedia

    reading the text of your question suggests other data is also not included including what ever was in the text box that didn't copy over
    Sorry to not add the numbers:
    Bond payable, 8% (issued at face amount) $20,000,000
    Preferred $2 stock, $10 par $20,000,000
    Common stock, $25 par $20,000,000
    paraclete's Avatar
    paraclete Posts: 2,706, Reputation: 172
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    #6

    Oct 6, 2012, 03:04 PM
    So more information but no attempt at the answer what is it you want to know

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