Question
Gray Corporation reported $700,000 in interest expense for the current year for bonds that were issued in prior years. Gray's tax rate is 30%. By
Gray Corporation reported $700,000 in interest expense for the current year for bonds that were issued in prior years. Gray's tax rate is 30%.
By what amount is the numerator of diluted EPS positively adjusted?
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Part 1
A.$490,000
B.$700,000
C.$0
D.$ 210,000
Charlotte Engineering had net income of $575,000 for the year. It declared $45,000in preferred dividends on December 23. It began the year with 700,000 common shares outstanding. On July 1, Charlotte declared a 10% common stock dividend. Compute the weightedaverage common shares outstanding for the year.
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Part 2
A.700,000
B.840,000
C.770,000
D.630,000
Ace Corporation has 10,000 shares of $100, 7%, convertible preferred shares outstanding for the whole year. Each preferred share is convertible into 2 shares of common stock. What is the incremental income per common share from the preferred stock?
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Part 3
A.$3.50
B.$50.00
C.$7.00
D. $1.00
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