Question
I. Stan Corp. provides the following data for 20x1. Transactions in common stock: 1/1, beginning 300,000 shares 4/1, issuance 100,000 shares 8% $100 par nonconvertible
I. Stan Corp. provides the following data for 20x1.
Transactions in common stock:
1/1, beginning 300,000 shares
4/1, issuance100,000 shares
8% $100 par nonconvertible cumulative preferred stock $100,000
Issued at par
6% $100 par convertible cumulative preferred stock$200,000
Issued at $105
Convertible into 20,000 shares
Stock options60,000 shares
Option price$25
Average market price$35
Year-end market price$40
The net income for 20x1 is $2,300,000. The companys tax rate is 30 percent. No conversion or options were exercised during 20x1.
Compute basic and diluted earnings per share.
I. Stan Corp. provides the following data for 20x1.
Transactions in common stock:
1/1, beginning 300,000 shares
4/1, issuance100,000 shares
8% $100 par nonconvertible cumulative preferred stock $100,000
Issued at par
6% $100 par convertible cumulative preferred stock$200,000
Issued at $105
Convertible into 20,000 shares
Stock options60,000 shares
Option price$25
Average market price$35
Year-end market price$40
The net income for 20x1 is $2,300,000. The companys tax rate is 30 percent. No conversion or options were exercised during 20x1.
Compute basic and diluted earnings per share.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started