On June 1, 2018, Cheyenne Company and Ayayai Company merged to
form Pina Inc. A total of 800,000 shares were issued to complete
the merger. The new corporation reports on a calendar-year
basis.
On April 1, 2020, the company issued an additional 563,000 shares
of stock for cash. All 1,363,000 shares were outstanding on
December 31, 2020.
Pina Inc. also issued $600,000 of 20-year, 7% convertible bonds at
par on July 1, 2020. Each $1,000 bond converts to 42 shares of
common at any interest date. None of the bonds have been converted
to date.
Pina Inc. is preparing its annual report for the fiscal year ending
December 31, 2020. The annual report will show earnings per share
figures based upon a reported after-tax net income of $1,421,000.
(The tax rate is 20%.)
Determine the following for 2020.
(a) The number of shares to be used for
calculating: (Round answers to 0 decimal places, e.g.
$2,500.)
(1) |
Basic earnings per share |
enter a number of shares rounded to 0 decimal places |
shares | |||
---|---|---|---|---|---|---|
(2) |
Diluted earnings per share |
enter a number of shares rounded to 0 decimal places |
shares |
(b) The earnings figures to be used for
calculating: (Round answers to 0 decimal places, e.g.
$2,500.)
(1) |
Basic earnings per share |
$enter a dollar amount rounded to 0 decimal places |
||
---|---|---|---|---|
(2) |
Diluted earnings per share |
$enter a dollar amount rounded to 0 decimal places |
The answer has been presenetd in the supporting sheet. For detailed answer refer to teh supporting sheet.
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