Additional Information

Annual excess fair over book value amortization of $$25,000$ resulted from the acquisition.

The parent applies the equity method to this investment.

Austin has $60,000$ shares of common stock and $15,000$ shares of preferred stock outstanding. Owners of the preferred stock are

paid an annual dividend of $$40,000,$ and each share can be exchanged for two shares of common stock.

Rio Grande has $41,000$ shares of common stock outstanding. The company also has $10,000$ stock warrants outstanding. For $$10,$

each warrant can be converted into a share of Rio Grande's common stock. Austin holds half of these warrants. The price of Rio

Grande's common stock was $$20$ per share throughout the year.

Rio Grande also has convertible bonds, none of which Austin owned. During the current year, total interest expense $($net of taxes$)$

was $$45,000.$ These bonds can be exchanged for $14,000$ shares of the subsidiary's common stock.

Determine Austin's basic and diluted EPS. $($Round your intermediate percentage value to $1$ decimal place. Round your final answers

to $2$ decimal places.$)$ following are separate income statements for Austin, Inc., and its $80$ percent$$owned subsidiary, Rio Grande Corporation as well as a consolidated statement for the business combination as a whole $($credit balances indicated by parentheses$).$

Austin Rio Grande Consolidated

Revenues $ $(746,000)$ $ $(546,000)$ $ $(1,292,000)$

Cost of goods sold $446,000254,000700,000$

Operating expenses $146,000116,000287,000$

Equity in earnings of Rio Grande $(120,800)$

Individual company net income $ $(274,800)$ $ $(176,000)$

Consolidated net income $ $(305,000)$

Noncontrolling interest in consolidated net income $(30,200)$

Consolidated net income attributable to Austin $ $(274,800)$

Additional Information

Annual excess fair over book value amortization of $$25,000$ resulted from the acquisition.

The parent applies the equity method to this investment.

Austin has $60,000$ shares of common stock and $15,000$ shares of preferred stock outstanding. Owners of the preferred stock are paid an annual dividend of $$40,000,$ and each share can be exchanged for two shares of common stock.

Rio Grande has $41,000$ shares of common stock outstanding. The company also has $10,000$ stock warrants outstanding. For $$10,$ each warrant can be converted into a share of Rio Grande$$s common stock. Austin holds half of these warrants. The price of Rio Grande$$s common stock was $$20$ per share throughout the year.

Rio Grande also has convertible bonds, none of which Austin owned. During the current year, total interest expense $($net of taxes$)$ was $$45,000.$ These bonds can be exchanged for $14,000$ shares of the subsidiary$$s common stock.

Determine Austin$$s basic and diluted EPS.