ZZZ Corporation Had Net Income of $100 Million Last Year

question 20

Multiple Choice

ZZZ Corporation had net income of $100 million last year and 50 million common shares outstanding.They declared an 8% stock dividend.Calculate EPS before and after the stock dividend.

• A)EPS before would be $2;after the dividend,EPS would be $1.85.
• B)There is not enough information to make this calculation.
• C)EPS before would be $0.50;after the dividend,EPS would be $0.46.
• D)Since they made $100 million in net income,the EPS cannot change.

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