Question - On January 1, 2010 Boxer Company had 110,000 share of common stock which was outstanding. During 2010 the following transactions took place:
- April 1- Repurchased 2000 shares which was accounted for as Treasury Stock
- August 30-Sold all the treasury shares
- December 1-Sold 10,000 shares for cash
- December 31-Reported Net Income in the amount of $200,000
- Paid preferred dividends of 20,000
These transactions occurred in 2011:
January 15: Declared and then issued at 20% stock dividend
December 31: Boxer Company reported net income in the amount of $238,500
Requirements:
Calculate Boxer Company's EPS for a simple capital structure for the both years to be presented in comparative financial statements. Since these are to be comparative statements the stock dividend declared and preferred dividend will be applied to both years. The financial statements will then be prepared at the end of 2011.