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Flyaway Travel Company reported net income for 2021 in the amount of $100,000. During 2021, Flyaway declared and paid $3,125 in cash dividends on its nonconvertible preferred stock. Flyaway also paid $20,000 cash dividends on its common stock. Flyaway had 50,000 common shares outstanding from January 1 until 20,000 new shares were sold for cash on April 1, 2021. What is 2021 basic earnings per share

Respuesta :

Answer:

$1.49

Explanation:

Flyaway Travel Company

$100,000 – $3,125

=$96,875

= $50,000 + (20,000 x 9/12)

=$50,000+$15,000

=$65,000

Hence:

$96,875÷$65,000

=$1.49

Therefore 2021 basic earnings per share will be $1.49