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Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Common Stockholders 14,180,000 Loss from Per Shares Outstanding Share 20,504,952 x 0.69 Discontinued Operations, Net of tax $ (2,950,000) Net Income Available to Common Stockholders 0x / Weighted Avg. Common Per Shares Outstanding Share Weighted Avg. Common Shares Outstanding Per Share 0x - $

Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Common Stockholders 14,180,000 Loss from Per Shares Outstanding Share 20,504,952 x 0.69 Discontinued Operations, Net of tax $ (2,950,000) Net Income Available to Common Stockholders 0x / Weighted Avg. Common Per Shares Outstanding Share Weighted Avg. Common Shares Outstanding Per Share 0x - $

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. ■ Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Shares Per Common Stockholders Outstanding Share $ 20,504,952 x = $ 0.69 14,180,000 Loss from Discontinued Operations, Net of tax $ (2,950,000) ✔ Net Income Available to Common Stockholders $ 0 x Weighted Avg. Common Per Shares Outstanding 0x = $ Share Weighted Avg. Common Shares Outstanding Per Share 0 x = $
Transcribed Image Text:Taft Corporation had after-tax income from continuing operations of $16.1 million for the year. Taft also reported a $2.95 million after-tax loss on the disposal of its textile subsidiary. Taft uses a calendar-year reporting period. Taft's capital structure consists of the following. ■ Preferred stock: 240,000 shares of $100 par, 8% cumulative nonconvertible preferred stock issued during the year. No dividends were declared in the current year. ■Common stock: 10,252,476 shares outstanding on January 1, $1 par. Dividends of $1 per share were declared and paid on June 30. On July 1, a three-for-one stock split was declared and the shares were issued. Required a. What type of capital structure does this company have (simple or complex)? Simple structure b. Compute required EPS amounts. c. Show the EPS presentation for financial reporting. Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny. Note: Use a negative sign with a loss. Income from Continuing Weighted Operations Available to Avg. Common Shares Per Common Stockholders Outstanding Share $ 20,504,952 x = $ 0.69 14,180,000 Loss from Discontinued Operations, Net of tax $ (2,950,000) ✔ Net Income Available to Common Stockholders $ 0 x Weighted Avg. Common Per Shares Outstanding 0x = $ Share Weighted Avg. Common Shares Outstanding Per Share 0 x = $
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