Getaway Travel Company Reported Net Income for 2018 in the Amount

question 108

Multiple Choice

Getaway Travel Company reported net income for 2018 in the amount of $50,000. During 2018, Getaway declared and paid $2,000 in cash dividends on its nonconvertible preferred stock. Getaway also paid $10,000 cash dividends on its common stock. Getaway had 40,000 common shares outstanding from January 1 until 10,000 new shares were sold for cash on July 1, 2018. A 2-for-1 stock split was granted on July 5, 2018. What is the 2018 basic earnings per share (rounded) ?

• A) $.42.
• B) $.47.
• C) $.53.
• D) $.56.

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