At the beginning of the current year, Norton Co. had 20,000 shares of $10 par common stock outstanding. During the year, it engaged in the following transactions related to its common stock. Net income for the year was $400,000 and the company also had 10,000 shares of 8% cumulative, non-convertible, preferred stock ($100/ share face value) outstanding for the entire year.
The corporate tax rate is 30%.
April 1 Issued 5,000 share of stock
June 1 Issued 3,000 share of stock
July 15 Issued a 10% stock dividend
September 1 Issued a four-for-one stock split
October 1 Reacquired 10,000 shares as treasury stock
December 1 Reissued the 5,000 shares of treasury stock
In addition to the above transactions, Norton Co. had the following convertible securities:
Security
Description
10.5 % Preferred Stock, Cumulative
$300,000 par value. Issued at 112. Each $100 par preferred stock is convertible into 3.3 shares of common stock.
11% Bonds
$520,000 face value. Issued at par. Each $1,000 bond is convertible into 27 shares of common stock.
4% Preferred Stock, Cumulative
$250,000 par value. Issued at par. Each $100 par preferred stock is convertible into 5 shares of common stock.
9% Bonds
$200,000 face value. Issued at 95. Discount being amortized over 20-year life. Each $10,000 bond is convertible into 32 shares of common stock.
8% Bonds
$300,000 face value. Issued at 107. Premium being amortized over 25-year life. Each $1,000 bond is convertible into 21 shares of common stock.
REQUIRED: (1) Determine the weighted average number of shares outstanding for computing the current earnings per share, (2) compute the basic earnings per share, (3) a schedule of the impact of the assumed conversion of each convertible security on EPS, (4) a ranking of the order in which the securities should be included in diluted EPS, (5) the diluted earnings per share, and (6) explanation about which EPS amounts should be reported for the company.
Question #1 [15 Points] Endowment income is a critical part of the annual budget at colleges and universities. The top 10 universities in terms of endowment income are shown below. Amounts are in billions of dollars. University Endowment ($billion) University Endowment ($billion) Columbia 7.2 Princeton 16.4 Harvard 36.6 Stanford 17.2 M.I.T. 10.1 Texas 16.1 Michigan 7.6 Texas A&M 6.7 Northwestern 7.2 Yale 22.9 (a) What is the mean endowment for these 10 universities. Show your work. [4 Points] (b) What is the median endowment? Show your work. [3 Points] (c) What is the mode endowment? [2 Points] (d) Compute the first and third quartiles. Show your work. [6 Points]#3 - 20 points: Consider a 2-person, 2-good economy. Endowments and utility functions are: el = (1,2) , u (x, y) = mintc, y} = (3,2) , u (x, y ) = cty Draw a carefully labeled Edgeworth box diagram showing: a) endowments b) indifference curves through the endowments c) the set of allocations that both agents prefer to the endowments1. Yang Company is making a four-column bank reconciliation at June 30 from the following date. The amounts per bank statement were: Balance, May 31, P650,000; June Recipts P1,300,000; June Disbursement, P1, 100,000. The amounts per book were: Balance, May 31, P763,500; June Receipts, P1,154,800; June Disbursement, P1,123,500; Balance, June 30, P794,800. May 31 June 30 Deposit in transit P120,000 P150,000 Outstanding Checks 67,000 84,000 The bank overlooked a check for P7,500 When recording a deposit on June 10 Note collected by bank, recorded after receiving the bank statement 180,000 Service charge, recorded after receiving the bank statement 4,500 6,000 NSF checks, recorded after receiving the Bank statement 56,000 48,000 Yang recorded a P37,400 check received from a customer in June as P34,700Accounting for Credit Card Sales Chassoul & Company pays a three percent credit card fee on all credit sales, and receives a cash deposit immediately following each credit card transaction. If credit sales for the company total $30,000 on January 15, what journal entry should be recorded to recognize the receipt of cash and the credit card fee expense? Debit Cash $29,100; debit Credit Card Fee Expense $900. CDebit Cash $29,100; credit Credit Card Fee Expense $900. CDebit Cash $30,900; debit Credit Card Fee Expense $900. Debit Cash $30,900; credit Credit Card Fee Expense $900.1. Restaurants do a large volume of business by credit and debit cards. Suppose Winter Retreats restaurant had these transactions on January 28, 2018: (Click the icon to view the transactions.) Read the requirements. Requirement 1. Suppose Winter Retreats' processor charges a 3% fee and deposits sales net of the fee. Journalize these sale transactions for the restaurant. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.} Journalize the credit sales net of the fee, first. Accounts and Explanation Debit Credit (1) 13) (4) (5) Now journalize the debit card sales net of the fee. Accounts and Explanation Debit Credit (6) (7) (9) (10 Requirement 2. Suppose Winter Retreats' processor charges a 3% fee and deposits sales using the gross method. Journalize these sale transactions for the restaurant. (For purposes of this problem, only record the sales revenue portion of these transactions using the gross method. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) First journalize the credit sales using the gross method. Accounts and Explanation Debit Credit (11 121 (14 (15) Lastly, journalize the debit sales using the gross method
