Question
D owns all 30,000 shares of common stock of B. D has 60,000 shares of its own common stock outstanding. During the year D earns
D owns all 30,000 shares of common stock of B. D has 60,000 shares of its own common stock outstanding. During the year D earns $200,000 none included from B, while B reports $150,000. Annual amortization of $10,000 is recognized each year on the consolidated worksheet based on acquisition date fair values. Both companies have convertible bonds outstanding. During the current year bond related interest expense(net of taxes) is $32,000 for D and 24,000 for B. D's bonds can be converted into 10,000 shares. D owns none of B's bonds.
Required:
*Prepare a schedule which shows the earnings per share amounts that should D should report in its current consolidated income statement. (See the text to prepare the schedule.)
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