【USCPA】FAR : Earnings Per Share (EPS)


Ute Co. had the following capital structure during the previous and current years:

Preferred Stock, $10 par, 4% cumulative, 25,000 shares issued and outstanding $250,000
Common Stock, $5 par, 200,000 shares issued and outstanding 1,000,000

Ute reported net income of $500,000 for the current year ended December 31. Ute paid no preferred dividends during the previous year and paid $16,000 in preferred dividends during the current year. In its current year December 31 income statement, what amount shouldUte report as earnings per share?


前提

Earnings Per Share (EPS) についての出題。

注意点

Basic EPS vs Diluted EPD
Cumulative vs Non
あたかも期首から〜の計算
ID : Income from continuing operation, Discontinued operations

 

数字まとめ

Preferred Stock, $10 par, 4% cumulative, 25,000 shares issued and outstanding $250,000
Common Stock, $5 par, 200,000 shares issued and outstanding 1,000,000

 

December 31, current year
net income 500,000

During previous year
paid no preferred dividends

During the current year
paid 16,000 preferred dividends

 

何が問われているのか

“In its current year December 31 income statement, what amount shouldUte report as earnings per share?”

➡︎ December 31 this year における、I/S 上の EPS の金額。

 

本問について

文意から、Basic EPS.

Basic EPS
= (NI (AT) – Preferred stock dividends) / Outstanding common shares

Preferred Stock Dividends:

Cumulative : Accumulated during this period (whether or not earned / declared)
Non-cumulative : Declared ONLY

Outstanding common shares

Weighted average effect

 
ここで、”Ute paid no preferred dividends during the previous year and paid $16,000 in preferred dividends during the current year.” に惑わされないようにしたい

Ute は 昨年 preferred dividends を払っておらず、今年になってトータル 16,000 払った。

16,000 の内訳は以下。

16,000
—Current year : 10,000 (250,000 * 4%)
—Previous year : 6,000 (=plug=)

 

Basic EPS の formula に入れるのは、THIS YEAR の分のみ!!

したがって cumulative preferred は 10,000.

 

解答

Choice “b” is correct. $2.45 earnings per share.

Net income$ 500,000
Less: Cumulative preferred(10,000)

Income available to common shares490 ,000

Divide by average common shares O/S. 200,000

490,000 / 200,000 = 2.45

Note: Since the preferred stock dividends are cumulative, when they are declared or paid is NOT relevant