12 . Kahlua Company had 100,000 shares of common stock outstanding on January 1st. On Septe sold 48,000 shares of common stock for cash Kahlua had 10,000 shares outstanding throughout the year. Each preferred stock is $ 100 par, 6% , and is convertible into common stock. Kahlua also had 500,8 %, convertible bonds outstanding throughout the year. \$1,0 convertible into 30 shares of common stock. The bonds were issued at par. Net income for the year $ 300,000 and the tax rate is 40\% . The preferred dividends were paid during the year. Basic earnings per share reported by Kahlua Company for the year is closest to: AJ $ 2.14 B) $2.68 C) $2.06 D ) $ 2.36 Diluted earnings per share reported by Kahlua Company for the year is closest to: $2.14 $ 2.68 $2.06 2.36 A ) B )

Use the following to answer questions 12 and 13: agar 3 noeten limbA Jal vast no Kahlua Company had 100,000 shares of common stock outstanding on January Ist. On September 30th, Kahlua sold 48,000 shares of common stock for cash. Kahlua had 10,000 shares of convertible preferred stock outstanding throughout the year. Each preferred stock is $100 par, 6%, and is convertible into 3 shares of common stock. Kahlua also had 500, 8%, convertible bonds outstanding throughout the year. Each $1,000 bond is convertible into 30 shares of common stock. The bonds were issued at par. Net income for the year was $300,000 and the tax rate is 40%. The preferred dividends were paid during the year. no - 12. Basic earnings per share reported by Kahlua Company for the year is closest to: A) $2.14 B) $2.68 C key-to-bos affl bogin C) $2.06 D) $2.36 13 Diluted earnings per share reported by Kahlua Company for the year is closest to: A) $2.14 B) $2.68 C C $2.06 D) $2.36 18 22 10.12