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Part 6: Earnings Per Share Free Corp. had $800,000 net income in 2020. The tax rate is 30%. 200,000 shares of common stock were outstanding
Part 6: Earnings Per Share Free Corp. had $800,000 net income in 2020. The tax rate is 30%. 200,000 shares of common stock were outstanding throughout 2020. Free Corp. had the following potentially dilutive securities: . There are 40,000 options to buy common stock at $30 a share outstanding. The market price of the common stock averaged $40 during 2020. During 2020, there were 40,000 shares of cumulative convertible 6% preferred stock outstanding. The preferred is $100 par and each share is convertible into three shares of common stock. Free Corp. issued $2,000,000 of 8% convertible bonds at face value during 2019. Each $1,000 bond is convertible into 20 shares of common stock. No bonds or preferred stock were converted during 2020. Required: a. Compute Basic EPS - Circle your final answer EPs s Net Income WAS b. Compute Diluted EPS - Circle your final answer (APIC
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