Question
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 $ |
(b) Compute diluted earnings per share for 2020,
assuming the same facts as above, except that $1,080,000 of 6%
convertible preferred stock was issued instead of the bonds. Each
$100 preferred share is convertible into 5 shares of Windsor common
stock. (Round answer to 2 decimal places, e.g.
$2.55.)
| Diluted earnings per share |
$
Homework Answers
Answer #1
The answer has been presenetd in the supporting sheet. For detailed answer refer to the supporting sheet.
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