howtoreadafinancialreport.pptVIP

The Income Statement,  Primary Earnings Per Common Share, cont. Add the two and get 200,000 shares altogether. Further, assume earnings are $500,000 for the year. With these facts, the computation--assuming the conversion of the preferred is: Earning Per Common Share Assuming Conversion of preferred: $500,000 Earnings for the year = $2.50 200,000 Adjusted Shares The Income Statement,  Primary Earnings Per Common Share, cont. However, as mentioned earlier, the “common stock equivalent” shares are only included in the computation if the effect of conversion on earnings per