Question

at december 31, 2025 and 2024, miley corp. had 180,000 shares of common stock and 12,000 shares of 6%, $100 par value cumulative preferred stock outstanding. $152,000 dividends were declared for common and preferred in 2024 and $144,000 were distributed to preferred in 2025. net income for 2025 was $450,000. for 2025, earnings per common share is

Answer 1

To calculate the earnings per common share at Miley Corp. for 2025, you need to determine the net income available to common stockholders and divide it by the average number of common shares outstanding.

Step-by-step explanation:

Earnings per common share is calculated by dividing the net income available to common stockholders by the average number of common shares outstanding. In this case, we need to first determine the net income available to common stockholders. Since $144,000 of dividends were distributed to preferred stock in 2025, the remaining net income available to common stockholders is $450,000 - $144,000 = $306,000.

Next, we need to calculate the average number of common shares outstanding. Since the number of common shares outstanding was the same at the end of both years, the average number is also the same. Therefore, the average number of common shares is 180,000 shares.

Finally, we can calculate the earnings per common share by dividing the net income available to common stockholders by the average number of common shares: $306,000 / 180,000 shares = $1.70 per share.