a corporation has the following stockholders' equity accounts at the end of the current fiscal year, after the closing entries have been posted: common stock, $5 par, $2,000,000; paid-in capital in excess of par--common stock, $375,000; retained earnings, $1,285,000. the earnings for the current year, during which there were no unusual items, were $400,000. compute the earnings per share of common stock.

Answer

$1.00 per share

Q: What is the total common stock? A: The total common stock is $2,000,000.
Q: What is the total paid-in capital in excess of par--common stock? A: The total paid-in capital in excess of par--common stock is $375,000.
Q: What is the total retained earnings? A: The total retained earnings is $1,285,000.
Q: What are the total earnings for the current year? A: The total earnings for the current year is $400,000.
Q: What is the total stockholder equity? A: The total stockholder equity is $4,060,000 (common stock + paid-in capital in excess of par--common stock + retained earnings).
Q: How many shares of common stock are outstanding? A: The number of shares of common stock outstanding is $2,000,000 ÷ $5 = 400,000 shares.
Q: What is the earnings per share of common stock? A: The earnings per share of common stock is $400,000 ÷ 400,000 shares = $1.00 per share.