## Answers

Class A | Class B | |

Basic EPS | $ 6.62 | $ 1.57 |

Working notes:

Earnings per share indicates the income earned by each share of common stock,

Shares Outstanding | Base dividend per share | Total Base Dividend | |

Class A | 95000 | 6 | 570000 |

Class B | 680000 | 0.95 | 646000 |

775000 | 1216000 |

Remaining earnings after base dividend = $1,700,000 - $1,216,000 = $484,000

Remaining earnings per share = $ 484,000 ÷ 775,000 shares = $ 0.624 (Rounded to 3 decimal)

Basic EPS = Base dividend per share + Remaining earnings per share,

Therefore Basic EPS would be,

- For Class A, EPS = $ 6 + 0.624 = $ 6.624
- For Class B, EPS = $ 0.95 + 0.624 = $ 1.574

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