Marsh Co. had 2,400,000 shares of common stock outstanding on January 1 and December 31, 2015. In connection with the acquisition of a subsidiary company in June 2014, Marsh is required to issue 100,000 additional shares of its common stock on July 1, 2016, to the former owners of the subsidiary. Marsh paid $100,000 in preferred stock dividends in 2015, and reported net income of $1,700,000 for the year. Marsh's diluted earnings per share for 2015 should be

Question

Lilibeth

Business

2 October, 06:34

Marsh Co. had 2,400,000 shares of common stock outstanding on January 1 and December 31, 2015. In connection with the acquisition of a subsidiary company in June 2014, Marsh is required to issue 100,000 additional shares of its common stock on July 1, 2016, to the former owners of the subsidiary. Marsh paid $100,000 in preferred stock dividends in 2015, and reported net income of $1,700,000 for the year. Marsh's diluted earnings per share for 2015 should be

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Van Ballard · Answer 1

Marsh's diluted earnings per share for 2015 should be $0.64

Explanation:

Marsh's diluted earnings per share for 2015

= $1,700,000 - $100,000 / 2,400,000 + 100,000

= $1,600,000 / 2,500,000

= $0.64