Basic EPS

Question 1

For the purpose of computing, basic earnings-per-share how should the income available to common stockholders be calculated?

Answer 1

The dividends on the non-cumulative preferred stock, and the current year dividends on the cumulative preferred stock should be added to the net income or loss

Question 2

Preferred stock dividends, and the basic EPS

Answer 2

For non-cumulative only declared dividends

For cumulative annual dividends, regardless, if declared or paid ; ignore dividends in arrears