The Regina Corporation reported the following information for the year ended December 31, 2018:
|
Net income |
$61,200 |
|
Interest expense |
5,000 |
|
Income taxes |
20,000 |
The company’s balance sheet at December 31, 2018 disclosed the following information: preferred shares ($0.12 per share cumulative dividends, 10,000 shares issued and outstanding at $20 per share); and common shares (15,000 shares issued and outstanding at $25 per share). During 2018, $5 per-share cash dividends were declared and paid to the common shareholders, in addition to the preferred share dividends. Dividend yield on common shares was 27.5%.
Required: Determine Regina’s:
- Earnings per share
- Price-earnings ratio.
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