Question

The information below pertains to Tamarisk Company for 2021. Net income for the year $1,140,000 6%...

The information below pertains to Tamarisk Company for 2021.

Net income for the year $1,140,000
6% convertible bonds issued at par ($1,000 per bond); each bond is convertible into
    30 shares of common stock
1,990,000
6% convertible, cumulative preferred stock, $100 par value; each share is convertible
     into 3 shares of common stock
4,110,000
Common stock, $10 par value 6,020,000
Tax rate for 2021 20%
Average market price of common stock $25 per share


There were no changes during 2021 in the number of common shares, preferred shares, or convertible bonds outstanding. There is no treasury stock. The company also has common stock options (granted in a prior year) to purchase 74,600 shares of common stock at $20 per share.

(a) Compute basic earnings per share for 2021. (Round answer to 2 decimal places, e.g. $2.55.)

Basic earnings per share $


(b) Compute diluted earnings per share for 2021. (Round answer to 2 decimal places, e.g. $2.55.)

Diluted earnings per share $

Homework Answers

Answer #1

Answer is given below

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Problem 16-8 The information below pertains to Vaughn Company for 2018. Net income for the year...
Problem 16-8 The information below pertains to Vaughn Company for 2018. Net income for the year $1,230,000 8% convertible bonds issued at par ($1,000 per bond); each bond is convertible into     30 shares of common stock 2,090,000 6% convertible, cumulative preferred stock, $100 par value; each share is convertible      into 3 shares of common stock 3,830,000 Common stock, $10 par value 6,110,000 Tax rate for 2018 40% Average market price of common stock $25 per share There were no...
The information below pertains to Baker Co. for 2017. Net income – 2017 $1,200,000 8% convertible...
The information below pertains to Baker Co. for 2017. Net income – 2017 $1,200,000 8% convertible bonds issued at par ($1,000 per bond); each bond is convertible into 30 shares of common stock $2,000,000 6% convertible, non-cumulative, preferred stock, $100 par value, each share is convertible into 3 shares of common stock $4,000,000 Common stock, $10 par value $6,000,000 Tax rate for 2017 40% Average market share price of common stock for 2017 $25 per share The company did have...
On January 1, 2020, Windsor Company issued 10-year, $2,010,000 face value, 6% bonds, at par. Each...
On January 1, 2020, Windsor Company issued 10-year, $2,010,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 15 shares of Windsor common stock. Windsor’s net income in 2020 was $518,400, and its tax rate was 20%. The company had 108,000 shares of common stock outstanding throughout 2020. None of the bonds were converted in 2020. (a) Compute diluted earnings per share for 2020. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share $...
On January 1, 2020, Shamrock Company issued 10-year, $1,880,000 face value, 6% bonds, at par. Each...
On January 1, 2020, Shamrock Company issued 10-year, $1,880,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 16 shares of Shamrock common stock. Shamrock’s net income in 2020 was $391,300, and its tax rate was 20%. The company had 91,000 shares of common stock outstanding throughout 2020. None of the bonds were converted in 2020. (a) Compute diluted earnings per share for 2020. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share $enter...
On January 1, 2020, Skysong Company issued 10-year, $1,890,000 face value, 6% bonds, at par. Each...
On January 1, 2020, Skysong Company issued 10-year, $1,890,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 16 shares of Skysong common stock. Skysong’s net income in 2020 was $470,000, and its tax rate was 20%. The company had 94,000 shares of common stock outstanding throughout 2020. None of the bonds were converted in 2020. (a) Compute diluted earnings per share for 2020. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share $enter...
On January 1, 2017, Vaughn Company issued 10-year, $2,150,000 face value, 6% bonds, at par. Each...
On January 1, 2017, Vaughn Company issued 10-year, $2,150,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 16 shares of Vaughn common stock. Vaughn’s net income in 2017 was $305,000, and its tax rate was 40%. The company had 97,000 shares of common stock outstanding throughout 2017. None of the bonds were converted in 2017. (a) Compute diluted earnings per share for 2017. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share $...
On January 1, 2020, Monty Company issued 10-year, $2,060,000 face value, 6% bonds, at par. Each...
On January 1, 2020, Monty Company issued 10-year, $2,060,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 16 shares of Monty common stock. Monty’s net income in 2020 was $414,100, and its tax rate was 20%. The company had 101,000 shares of common stock outstanding throughout 2020. None of the bonds were converted in 2020 (please explain how to do these problem without using excel if possible). (a) Compute diluted earnings per share for 2020. (Round...
On January 1, 2017, Andrew and Sons issued 10-year, $2,060,000 face value, 6% bonds, at par....
On January 1, 2017, Andrew and Sons issued 10-year, $2,060,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 16 shares of Andrew common stock. Andrew’s net income in 2017 was $294,000, and its tax rate was 40%. The company had 101,000 shares of common stock outstanding throughout 2017. None of the bonds were converted in 2017. (a) Compute diluted earnings per share for 2017. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share...
Paul Company had 100,000 shares of common stock outstanding on January 1, 2021. On September 30,...
Paul Company had 100,000 shares of common stock outstanding on January 1, 2021. On September 30, 2021, Paul sold 58,000 shares of common stock for cash. Paul also had 15,000 shares of convertible preferred stock outstanding throughout 2021. The preferred stock is $100 par, 7%, and is convertible into 3 shares of common for each share of preferred. Paul also had 600, 9%, convertible bonds outstanding throughout 2021. Each $1,000 bond is convertible into 30 shares of common stock. The...
6. Earnings per Share with Convertible Bonds On January 1, 2019, Houston Company issued, at par,...
6. Earnings per Share with Convertible Bonds On January 1, 2019, Houston Company issued, at par, 600 $1,000 6% bonds. Each bond is convertible into 10 shares of common stock. Houston’s net income for 2019 was $600,000. The tax rate was 20%. Throughout 2019, 100,000 shares of $10 par common stock were outstanding. In addition, 1,000 shares of 5% $100 par cumulative preferred stock were outstanding. No preferred stock dividends were declared during 2019. None of the bonds were converted...