Question

Last year, East Corporation reported basic and diluted EPS in an amount less than basic EPS...

Last year, East Corporation reported basic and diluted EPS in an amount less than basic EPS due to outstanding stock options. Those options were excercised on January 1 of the current year.

During the current year, East Corporation had 15.0 million shares of common stock outstanding. Three thousand eight hundred 10% convertible bonds, each with $1,000 face value, were issued at face amount at the beginning of the year. East reported net income of $3.8 million for the year. Each bond is convertible into 10 shares of common stock. The tax rate is 25%. What is diluted EPS (rounded)? (Round your answer to 2 decimal places. Do not round your intermediate calculations.)

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1
Particulars $
Numerator
Net Income $       3,800,000
Add Post tax Interest on convertible bonds $          285,000
Numerator for Diluted EPS $       4,085,000
Denominator for diluted EPS
Opening common stock outstanding         15,000,000
Add Common stock due to bond conversion                38,000
Denominator for diluted EPS         15,038,000
Diluted EPS (Numerator/ Denominator) $                0.27

For any clarification, please comment. Kindly Up Vote!

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
Last year, East Corporation reported basic and diluted earnings per share in an amount less than...
Last year, East Corporation reported basic and diluted earnings per share in an amount less than basic EPS due to outstanding stock options. Those options were exercised on January 1 of the current year. During the current year, East Corporation had 15.5 million shares of common stock outstanding. Three thousand nine hundred 12% convertible bonds, each with $1,000 face value, were issued at face amount at the beginning at the beginning of the year. East reported net income of $3.9...
During the current year, High Corporation had 4.9 million shares of common stock outstanding. $7,875,000 of...
During the current year, High Corporation had 4.9 million shares of common stock outstanding. $7,875,000 of 20% convertible bonds were issued at face amount at the beginning of the year. High reported income before tax of $5.9 million and net income of $4.9 million for the year. The bonds are convertible into 815,000 shares of common. What is diluted EPS (rounded)?
During the current year, High Corporation had 5.0 million shares of common stock outstanding. $8,025,000 of...
During the current year, High Corporation had 5.0 million shares of common stock outstanding. $8,025,000 of 17% convertible bonds were issued at face amount at the beginning of the year. High reported income before tax of $6.0 million and net income of $5.0 million for the year. The bonds are convertible into 825,000 shares of common. What is diluted EPS (rounded)? Choices are 1.09 2.73 1.23 1.05
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...
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.
Ahnberg Corporation had 560,000 shares of common stock issued and outstanding at January 1. No common...
Ahnberg Corporation had 560,000 shares of common stock issued and outstanding at January 1. No common shares were issued during the year, but on January 1, Ahnberg issued 180,000 shares of convertible preferred stock. The preferred shares are convertible into 360,000 shares of common stock. During the year Ahnberg paid $108,000 cash dividends on the preferred stock. Net income was $1,060,000. What were Ahnberg's basic and diluted earnings per share for the year? (Round your answers to 2 decimal places.)...
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...
given the following year end information compute Greeneood corporations basic and diluted earnings per share. net...
given the following year end information compute Greeneood corporations basic and diluted earnings per share. net income 15,000 the income tax rate 30% 4000 shares of common stock were outstanding the entire year. 500 shares of 10% $50 par (and issuance price) convertible preferred stock were outstanding the entire year. dividends of 2500 were declared on this stock during the year. each share of prefferred stock is convertible into 5 shares of commin stock. need basic earning per share diluted...
1)Beta reported $6,000,000 in net income for the current year. The company had $500,000 of 10%...
1)Beta reported $6,000,000 in net income for the current year. The company had $500,000 of 10% non-convertible preferred stock outstanding all year and $5,000,000 of 6% convertible bonds outstanding all year. Assuming the convertible bonds are dilutive, determine the numerator of both basic and diluted EPS when the tax rate is 40%. 2)On February 4, 2016, Investor purchased 15% of Investee common stock for $62,000. Investee’s net income for the years ended December 31 2016 and 2017 were $18,000 and...
PLEASE SHOW ALL WORK AND EXPLAIN Stevens Corporation had 28,487 shares of common stock outstanding during...
PLEASE SHOW ALL WORK AND EXPLAIN Stevens Corporation had 28,487 shares of common stock outstanding during the current calendar year. On July 1, Stevens issued 2,848 convertible bonds . Each bond had a $1,000 face value. Each bond is convertible into 50 shares of common stock. The bonds were issued at face amount and pay stated rate of 8% interest annually for 10 years. Stevens had a net income of $228,849. Stevens’ tax rate was 30%. Stevens’ Diluted EPS is...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT