E16-20 (EPS: Simple Capital Structure)
On January 1, 2010, Bailey Industries had stock outstanding as follows.
| 6% Cumulative preferred stock $100 par value issued and outstanding 10,000 shares | 1,000,000 |
| Common stock, $10 par value, issued and outstanding 200,000 shares | 2,000,000 |
To acquire the net assets of three smaller companies, Bailey authorized the issuance of an additional 170,000 common shares. The acquisitions took place as follows.
| Date of Acquisition | Shares | Issued |
| Company | A April 1, 2010 | 60,000 |
| Company B | July 1, 2010 | 80,000 |
| Company C | October 1, 2010 | 30,000 |
On May 14, 2010, Bailey realized a $90,000 (before taxes) insurance gain on the expropriation of investments originally purchased in 2000.
On December 31, 2010, Bailey recorded net income of $300,000 before tax and exclusive of the gain.
Assuming a 40% tax rate, compute the earnings per share data that should appear on the financial statements of Bailey Industries as of December 31, 2010. Assume that the expropriation is extraordinary.
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