Question
At the beginning of 2020, Sheridan Industries had 27,000 shares of common stock issued and outstanding and 500 $ 1,000, 6% bonds (issued at par),
At the beginning of 2020, Sheridan Industries had 27,000 shares of common stock issued and outstanding and 500 $ 1,000, 6% bonds (issued at par), each convertible into 10 shares of common stock. During 2020, Sheridan had revenues of $ 150,000 and expenses other than interest and taxes of $ 101,000. Assume that the tax rate is 40%. None of the bonds was converted or redeemed. (a) Compute diluted earnings per share for 2020. (Round answer to 2 decimal places, e.g. 2.55.)
Earnings per share | $ enter a dollar amount rounded to 2 decimal places |
(b) Assume the same facts as those assumed for part (a), except that the 500 bonds were issued on September 1, 2020 (rather than in a prior year), and none have been converted or redeemed. Compute diluted earnings per share for 2020. (Round answer to 2 decimal places, e.g. 2.55.)
Earnings per share | $ enter a dollar amount rounded to 2 decimal places |
(c) Assume the same facts as assumed for part (a), except that 100 of the 500 bonds were actually converted on July 1, 2020. Compute diluted earnings per share for 2020.
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