Norman's Cabinet, Inc

question 18

Essay

Norman's Cabinet, Inc., had net income of $213,400 for its fiscal year ended October 31, 2017. During the year, the company had outstanding 26,500 shares of 9%, $60 par value preferred stock, and 37,000 shares of common stock. Calculate the basic earnings per share of common stock for the 2017 fiscal year.

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Definitions:

Inventory Valuation

The method or process of calculating the cost or value of inventory held by a business.

Common Stock

A type of security that represents ownership in a corporation, where shareholders are entitled to a portion of the company's profits through dividends and voting rights on corporate matters.

Asset Test

A liquidity ratio, also known as the quick ratio, measuring a company's ability to meet its short-term obligations with its most liquid assets.