Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

A Corporation had $2,100,000 net income in 2016. On January 1, 2016 there were 200,000 shares of common stock outstanding. On April 1, 24,000 shares

image text in transcribed

A Corporation had $2,100,000 net income in 2016. On January 1, 2016 there were 200,000 shares of common stock outstanding. On April 1, 24,000 shares were issued and on September 1, the Corporation bought 36,000 shares of treasury stock. There are 33,000 options to buy common stock at $40 a share outstanding. The market price of the common stock averaged $50 during 2016. The tax rate is 25% During 2016 there were 20,000 shares of convertible preferred stock outstanding. The preferred is $100 par, pays dividend of $9 a year, and is convertible into two shares of common stock. The preferred dividend for 2016 was paid. The Corporation issued $2,000,000 of 8% convertible bonds at face value during 2014. Each $1,000 bond is convertible into 11 shares of common stock. Assumptions: Stock options, preferred stock, and bonds are dilutive. Assume now the weighted average number of shares outstanding for computing the Basic Earnings per share was 200,000, for computing the Diluted Earnings per share, the Weighted average number of shares outstanding in 2016 is. A Corporation had $2,100,000 net income in 2016. On January 1, 2016 there were 200,000 shares of common stock outstanding. On April 1, 24,000 shares were issued and on September 1, the Corporation bought 36,000 shares of treasury stock. There are 33,000 options to buy common stock at $40 a share outstanding. The market price of the common stock averaged $50 during 2016. The tax rate is 25% During 2016 there were 20,000 shares of convertible preferred stock outstanding. The preferred is $100 par, pays dividend of $9 a year, and is convertible into two shares of common stock. The preferred dividend for 2016 was paid. The Corporation issued $2,000,000 of 8% convertible bonds at face value during 2014. Each $1,000 bond is convertible into 11 shares of common stock. Assumptions: Stock options, preferred stock, and bonds are dilutive. Assume now the weighted average number of shares outstanding for computing the Basic Earnings per share was 200,000, for computing the Diluted Earnings per share, the Weighted average number of shares outstanding in 2016 is

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Security Audit And Control Features SAP ERP

Authors: Deloitte Touche Tohmatsu Research Team And Isaca

3rd Edition

1604201150, 978-1604201154

More Books

Students also viewed these Accounting questions