Information concerning the capital structure of the Petrock Corporation is as follows: December 31, _______________________________________2016 2017 Common

Question:

Information concerning the of the Petrock is as follows:
December 31,
_______________________________________2016 2017
Common stock...................................90,000 shares................90,000 shares
Convertible preferred stock....................10,000 shares................10,000 shares
8%, $1,000 par, convertible bonds...............$1,000,000...................$1,000,000
During 2017, Petrock paid dividends of $1 per share on its and $2.40 per share on its preferred stock. The preferred stock is convertible into 20,000 shares of common stock.
The 8% convertible bonds are convertible into 30,000 shares of common stock. The net income for the year ending December 31, 2017, was $285,000, and the company's income tax rate was 40%.
Required:
1. What was basic EPS for 2017, rounded to the nearest penny?
2. What was diluted EPS for 2017, rounded to the nearest penny?
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Capital Structure
Capital structure refers to a company’s outstanding debt and equity. The capital structure is the particular combination of debt and equity used by a finance its overall operations and growth. Capital structure maximizes the market value of a... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...