A Company Had 20,000 Shares of Common Stock Outstanding on January

question 124

Multiple Choice

A company had 20,000 shares of common stock outstanding on January 1, 2001. On October 110,000 shares of non-cumulative preferred stock were issued as a stock dividend. No cash dividends were paid or declared in 2007 and 2007 net income was $450,000. Earnings per share (rounded to nearest cent) :

• A) $15.00.
• B) $22.50.
• C) $20.00.
• D) $30.00.

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