Sumner Industries Began the Year with 140,000 Shares of Common

question 84

Essay

Sumner Industries began the year with 140,000 shares of common stock and 10,000 shares of 6%, $100 par value, cumulative, nonconvertible preferred stock. On April 1 it declared a 10% stock dividend on common shares. On June 1, it purchased 15,000 shares of treasury stock. On December 1, Sumner declared a 2 for 1 stock split. Net income for the year was $570,000. Compute weighted average shares of common stock for the year and basic EPS.
Instructions: Write the EPS formula. Show all computations used in your solution.

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Definitions:

Culture Shock

A sense of disorientation that occurs when entering a radically new social or cultural environment.

Sociologists

Scholars and practitioners who study the development, structure, and functioning of human society, including the complex interactions and relationships within it.

Signs

Symbols that stand for or convey an idea.

Symbolic Culture

The aspect of culture that includes nonmaterial cultural elements such as beliefs, practices, values, and symbols that have meaning and significance in society.