Question Details

When a corporation has both preferred and common stock 




	1.	Bedazzle Corporation had 440,000 shares of common stock outstanding during the year. Norman declared and paid cash dividends of $400,000 on the common stock and $320,000 on the preferred stock. Net income for the year was $1,760,000. What is Bedazzle- earnings per share?
a.	$3.09
b.	$4.00
c.	$3.27
d.	$2.36


	2.	When a corporation has both preferred and common stock outstanding, earnings per share is computed by dividing net income
a.	by ending common shares outstanding.
b.	by weighted average common shares outstanding.
c.	less preferred dividends by ending common shares outstanding.
d.	less preferred dividends by the weighted average of common shares outstanding.


	3.	In determining earnings per share, dividends for the current year on noncumulative preferred stock should be
a.	disregarded.
b.	added back to net income whether declared or not.
c.	deducted from net income only if declared.
d.	deducted from net income whether declared or not.


4.	Reserves include each of the following except
a.	other comprehensive income items.
b.	revaluation surplus.
c.	share premium.
d.	unrealized gains on available-for-sale securities.


5.	Previously issued financial statements with errors are required to be restated under
a.	GAAP only.
b.	IFRS only.
c.	Both GAAP and IFRS.
d.	Neither GAAP or IFRS.



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