What is the formula to get dividends on preferred stock
Bonds payable, 8% (issued at face amount) 20,000,000
Preferred $2 stock, $10 par 20,000,000
Common stock, $25 par 20,000,000
Income tax is estimated at 40% of income.
Determine the earning per share of common stock, assuming, that the income before bond interest and income interest tax is (a) 10,000,000, (b) 12,000,000, (c) 14,000,000. This is what I have so far:
Earning 10,000,000 earnings 12,000,000 Earning 14,000,000
Bond Interest 1,600,000 Bond Interest 1,600,000 Bond Interest 1,600,000
Balance 8,400,000 Balance 10,400,000 Balance 12,400,000
Income Tax 3,360,000 Income Tax 4,160,000 Income Tax 4,960,000
Net Income 5,040,000 Net Income 6,240,000 Net Income 7,440,000
Now I'm stuck I don't know how to figure out dividends on preferred stock,
Earning available for common stock
Divide number of common shares
To get per share on common stock. Can you help me please.
