Everdeen Mining, Inc., ended 2015 with net profits before
taxes of $441,000. The company is subject to a 40% tax rate and must pay $63,900
in preferred stock dividends before distributing any earnings on the 164,000
shares of common stock currently outstanding.
a. Calculate Everdeen's 2015 earnings per share (EPS).
b. If the firm paid common stock dividends of$0.81 per
share, how many dollars would go to retained earnings?
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