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a. b. c.
Earnings before bond interest and income tax 10,500,000$ 11,800,000$ 13,000,000$
Bond interest
Balance
Income tax
Net income
Dividends on preferred stock
Earnings available for common stock
Number of common shares outstanding
Earnings per share on common stock
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Earnings per Share of Common Stock
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Earnings before bond interest and income tax 10,500,000$ 11,800,000$ 13,000,000$
Bond interest 800,000 800,000 800,000
Earnings available for common stock 820,000$ 1,600,000$ 2,320,000$
Earnings per Share of Common Stock
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a.
January 1
Carrying
Amount
Decrease in
Notes Payable
Dec. 31, 2016
Dec. 31, 2017
Dec. 31, 2018
Dec. 31, 2019
b. 2016
Jan. 1
Dec. 31
2017
Dec. 31
2018
Dec. 31
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Amortization of Installment Notes
2019
Dec. 31
c. Interest expense to be reported on the income statement:
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a.
January 1
Carrying
Amount
Decrease in
Notes
Payable
Dec. 31, 2016 147,750$ 43,620$ 10,343$ 33,277$ 114,473$
Dec. 31, 2017 114,473 43,620 8,013 35,607 78,866
b. 2016
Jan. 1 147,750
147,750
2017
Dec. 31 35,607
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Amortization of Installment Notes
43,620
2019
Dec. 31 40,767
Cash
Interest Expense