INFORMATION RELATING TO CAPITAL STRUCTURE 20X0 FOR YEARS 20X0 AND 20X1 20x1 Outstanding Shares of Stock 100,000 20,000 1,000,000 1,000,000 120,000 Common Stock Convertible Preferred Stock 8% Convertible Bonds 20,000 The company paid dividends of $4.00 per share on the preferred stock in both years and are convertible into 30,000 shares of common stock. The convertible bonds are convertible into 40,000 shares of common stock. Net income for 20X1 was $600,000 and the income tax rate is 40%. The basic earnings per share for 20X1 is: (a) $5.00. (b) $4.33. (c) $3.83. (d) $4.86. Using the information from Question 15, what is the company's diluted earnings per share? (a) $4.86. (b) $4.53. (c) $5.00. (d) $3.41 16. 17. A company uses the percentage of completion method to account for a three year construction contract. calculation of the income recognized in the first year of the contract? (a) Progress billings. Which of the following should be used in the (b) Actual construction costs for year. (c) Collections on progress billings. (d) Estimated construction costs for year A company started a long term construction project in 20X0. The following data relate to this project. 18