Question
Computing EPS: Convertible Bonds A company has outstanding $80,000 of 8% convertible bonds due in five years. Each $1,000 convertible bond is convertible into 40
Computing EPS: Convertible Bonds
A company has outstanding $80,000 of 8% convertible bonds due in five years. Each $1,000 convertible bond is convertible into 40 shares of common stock. Net income for the year was $512,000. Common shares outstanding for the year were 150,000. The relevant tax rate is 25%.
a. Compute basic earnings per share.
b. Compute diluted earnings per share.
Note: Enter the earnings per share amounts in dollars and cents, rounded to the nearest penny.
| Net Income Available to Common Stockholders | Weighted Avg. Common Shares Outstanding | Per Share | |
|---|---|---|---|
| Basic EPS | |||
| Diluted EPS |
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ICSA Study Text In Management Accounting
Authors: Richard Lyall
4th Edition
186072308X, 978-1860723087
