Intermediate Accounting II

Purple Co reported net income of $500,000 for the year ended Dec 31, 20x7. Throughout 20x7 Purple Co had 20,000 outstanding shares of common and 2,000 outstanding shares of 5%, $100-par, non-cumulative, preferred stock. Each share of preferred is convertible into 2 shares of common. No dividends were declared or paid in 20x6, but in 20x7 dividends were declared and paid. Calculate basic earnings per share and dilute earnings per share. BASIC EPS DILUTED EPS A $25.00 $0 (antidilutive) B $24.50 $20.83 C $24.50 $0 (antidilutive) D $25.00 $20.83