FASB ASC 260 requires basic EPS to be calculated using income available to common stockholders divided by weighted-average common shares outstanding. The key data includes net income of $5,000,000, declared noncumulative preferred dividends of $800,000, and 2,000,000 weighted-average common shares. The correct answer of $2.10 properly calculates income available to common as $5,000,000 - $800,000 = $4,200,000, then divides by 2,000,000 shares to get $2.10. Answer B ($2.50) incorrectly ignores the preferred dividends, Answer C ($2.60) uses an incorrect calculation, and Answer D ($2.00) appears to overstate the preferred dividend deduction. For noncumulative preferred stock, only declared dividends are deducted from net income, unlike cumulative preferred where dividends accrue regardless of declaration. This framework ensures that EPS reflects only the earnings attributable to common stockholders after satisfying preferred dividend obligations.