Question

Computing EPS: Convertible Bonds A company has outstanding $100,000 of 8% convertible bonds due in five...

Computing EPS: Convertible Bonds

A company has outstanding $100,000 of 8% convertible bonds due in five years. Each $1,000 convertible bond is convertible into 40 shares of common stock. Net income for the year was $640,000. Common shares outstanding for the year were 250,000. The relevant tax rate is 25%.

a. Compute basic earnings per share.

b. Compute diluted earnings per share.

Note: Round per share amounts to two decimal places.

Net Income Available to
Common Stockholders		 Weighted Avg. Common
Shares Outstanding		 Per
Share
Basic EPS Answer Answer Answer
Diluted EPS Answer Answer Answer
Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Computing EPS: Convertible Preferred with Partial Conversion Bridgeman Company, headquartered in San Francisco, reported the following...
Computing EPS: Convertible Preferred with Partial Conversion Bridgeman Company, headquartered in San Francisco, reported the following data for the current year. Net income, $2,220,000. Common shares outstanding at the beginning of the year, 800,000. Nonconvertible cumulative preferred stock, $100 par, $8 dividend per share per year, 100,000 shares outstanding all year. Issued 200,000 shares of common stock on October 1. Convertible cumulative preferred stock, $100 par, $7 dividend per share per year, 50,000 shares outstanding at the beginning of the...
Exercise 19-21 (Algo) EPS; convertible preferred stock; convertible bonds; order of entry [LO19-7, 19-9] Information from...
Exercise 19-21 (Algo) EPS; convertible preferred stock; convertible bonds; order of entry [LO19-7, 19-9] Information from the financial statements of Ames Fabricators, Inc., included the following: December 31 2021 2020 Common shares 100,000 100,000 Convertible preferred shares (convertible into 82,000 shares of common) 32,400 32,400 8% convertible bonds (convertible into 30,000 shares of common) $ 1,000,000 $ 1,000,000 Ames’s net income for the year ended December 31, 2021, is $840,000. The income tax rate is 25%. Ames paid dividends of...
A firm issued $300,000 8% bonds (at face value) convertible into 4,000 of the firm's common...
A firm issued $300,000 8% bonds (at face value) convertible into 4,000 of the firm's common shares 3,000 $30 cumulative preferred shares each convertible into 3 common share The tax rate is 30% The firm had earnings $300,000 There was 60,000 common shares outstanding the entire year. Compute for basic Eps and Diluted Eps and show your solution
Problem 19-14 (Algo) EPS; convertible preferred stock; convertible bonds; order of entry [LO19-7, 19-9, 19-10] Information...
Problem 19-14 (Algo) EPS; convertible preferred stock; convertible bonds; order of entry [LO19-7, 19-9, 19-10] Information from the financial statements of Henderson-Niles Industries included the following at December 31, 2021: Common shares outstanding throughout the year 100 million Convertible preferred shares (convertible into 40 million shares of common) 65 million Convertible 8% bonds (convertible into 13.5 million shares of common) $ 1,000 million Henderson-Niles’s net income for the year ended December 31, 2021, is $600 million. The income tax rate...
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...
Harris Pilton has 150,000 shares of common stock outstanding on January 1. On February 1, the...
Harris Pilton has 150,000 shares of common stock outstanding on January 1. On February 1, the company issued 50,000 additional shares for $50.00 each. On April 30, the company repurchased 5,000 treasury shares. On June 1, the company made a 4-for-3 bonus issue. On August 1, the company issued 1,000 new shares of common stock for $45.00 each. On September 30th, the company issued a 15% stock dividend. Harris Pilton has 2,000 shares of 5%, $10 par, noncumulative, nonconvertible preferred...
Computing Diluted EPS: Stock Options Rand Inc. had net income of $1,760,000. During the year, 400,000...
Computing Diluted EPS: Stock Options Rand Inc. had net income of $1,760,000. During the year, 400,000 shares were outstanding on average and Rand's common stock sold at an average market price of $50 per share. In addition, Rand had 40,000 stock options outstanding to purchase a total of 40,000 common shares at $25 for each option exercised. Required a. Compute basic EPS. b. Compute diluted EPS.
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...
Murray Company reports net income of $893,000 for the year. It has no preferred stock, and...
Murray Company reports net income of $893,000 for the year. It has no preferred stock, and its weighted-average common shares outstanding is 380,000 shares.    Compute its basic earnings per share. Murray Company reports net income of $893,000 for the year. It has no preferred stock, and its weighted-average common shares outstanding is 380,000 shares.    Compute its basic earnings per share. Basic Earnings Per Share Choose Numerator: / Choose Denominator: = Basic EPS – / = Basic EPS –...
Paul Company had 100,000 shares of common stock outstanding on January 1, 2018. On September 30,...
Paul Company had 100,000 shares of common stock outstanding on January 1, 2018. On September 30, 2018, Paul sold 45,000 shares of common stock for cash. Paul also had 8,500 shares of convertible preferred stock outstanding throughout 2018. The preferred stock is $100 par, 5%, and is convertible into 3 shares of common for each share of preferred. Paul also had 470, 7%, convertible bonds outstanding throughout 2018. Each $1,000 bond is convertible into 30 shares of common stock. The...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT