For several years Arban, Inc., has followed a policy of paying a cash dividend o

Question

For several years Arban, Inc., has followed a policy of   paying a cash dividend of $0.47 per share and having a 5% stock dividend. In   the 2011 annual report, Arban reported restated earnings per share for 2009   of $0.93.

Required:

(a)

Calculate the originally reported earnings per share for   2009. (Do not round intermediate calculations   and round your final answer to 2 decimal places. Omit the "$"   sign in your response.)

  Earnings per share for   2009

$  

(b)

Calculate the restated cash dividend per share for 2009   reported in the 2011 annual report for comparative purposes. (Do not round intermediate calculations and round   your final answer to 2 decimal places. Omit the "$" sign in your   response.)

  Dividend per share for   2011

$  

  

For several years Arban, Inc., has followed a policy of   paying a cash dividend of $0.47 per share and having a 5% stock dividend. In   the 2011 annual report, Arban reported restated earnings per share for 2009   of $0.93.

   For several years Arban, Inc., has followed a policy of paying a cash dividend of $0.47 per share and having a 5% stock dividend. In the 2011 annual report, Arban reported restated earnings per share for 2009 of $0.93. Required: Calculate the originally reported earnings per share for 2009. (Do not round intermediate calculations and round your final answer to 2 decimal places. Omit the "$" sign in your response.) Earnings per share for 2009 Calculate the restated cash dividend per share for 2009 reported in the 2011 annual report for comparative purposes. (Do not round intermediate calculations and round your final answer to 2 decimal places. Omit the "$" sign in your response.) Dividend per share for 2011

Explanation / Answer

Hi,

Please find the answer as follows:

Part A:

Earnings Per Share - 2009

EPS as reported in 2011 = .93

EPS as reported in 2010 = .93*(1+.05) = .9765

EPS as reported in 2009 = .9765*(1+.05) = 1.025 or 1.03

Answer is 1.03

Part B:

Dividend Per Share - 2009

Dividend as reported in 2009 = .47

Dividend as reported in 2010 = .47/(1+.05) = ..4476

Dividend as reported in 2011 = .4476/(1+.05) = .426 or .43

Answer is .43

Thanks.

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