Problem - Earnings Per Share
Financial statement data for the years ended December 31 for Dovetail Corporation follow:
20Y3 20Y2
Net income $510,500 $452,000
Preferred dividends $78,000 $78,000
Average number of common shares outstanding 50,000 shares 40,000 shares
a. Determine the earnings per share for 20Y3 and 20Y2. Round your answers to two decimal places.
b. Does the change in the earnings per share from 20Y2 to 20Y3 indicate a favorable or an unfavorable trend?