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Hanson Co. had 200,000 shares of common stock and $1,500,000 of 5% convertible bonds outstanding during 2018. Each $1,000 bond is convertible into 30 shares
Hanson Co. had 200,000 shares of common stock and $1,500,000 of 5% convertible bonds outstanding during 2018. Each $1,000 bond is convertible into 30 shares of common stock and was issued at par. The net income for 2018 was $600,000 and the income tax rate was 30%. Diluted earnings per share for 2018 is (rounded to the nearest penny) a) $2.08. b) $2.12. c) $2.29. d) $2.66. Goofy Inc. bought 15,000 shares of Crazy Co.'s stock for $210,000 on May 5, 2008 as equity investment. The market value of the stock declined to $130,000 by December 31, 2008. The market value of these shares had risen to $170,000 on December 31, 2009. What effect on 2009 income should be reported by Goofy for the Crazy Co. shares? a) $40,000 net gain. b) $0. c) $80,000 net loss. d) $40,000 net loss
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