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Martinez Company had 210,000 shares of common stock outstanding on December 31, 2018.
During the year 2019, the company issued 8,000 shares on May 1 and retired 14,000 shares on
October 31. For the year 2019, Martinez Company reported net income of $271,100 after a loss
from discontinued operations of $41,000 (net of tax).
What earnings per share data should be reported at the bottom of its income statement?
Solution
Weighted average shares outstanding = 210000+(8000/12*8)-(14000/12*2)= 213000
Earnings per share = Net income/Weighted average shares outstanding = 271100/213000= 1.27

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Martinez Company had 210,000 shares of common stock outstanding on D.pdf

  • 1. Martinez Company had 210,000 shares of common stock outstanding on December 31, 2018. During the year 2019, the company issued 8,000 shares on May 1 and retired 14,000 shares on October 31. For the year 2019, Martinez Company reported net income of $271,100 after a loss from discontinued operations of $41,000 (net of tax). What earnings per share data should be reported at the bottom of its income statement? Solution Weighted average shares outstanding = 210000+(8000/12*8)-(14000/12*2)= 213000 Earnings per share = Net income/Weighted average shares outstanding = 271100/213000= 1.27