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Mayan Company had net income of $36,520. The weighted-average common shares outstanding were 8,800. The company declared a $3,500 dividend on its noncumulative, nonparticipating preferred stock. There were no other stock transactions. The company's earnings per share is_____________.

Respuesta :

Answer:

The correct answer is $3.75.

Explanation:

According to the scenario, the given data are as follows:

Net income = $36,520

Weighted-average common shares outstanding = 8,800

Dividend = $3,500

So, we can calculate the earning per share by using following formula:

Earning per Share = (Net Income - Dividend) ÷ Weighted-average common shares outstanding

By putting the value in formula, we get

Earning per share = ( $36,520 - $3,500 ) ÷ 8,800

= $33,020 ÷ 8,800

= $3.75

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