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Please answer all step by step i need to understand the material thank you E 1 5 . 2 3 ( LO 5 ) (
Please answer all step by step i need to understand the material thank you
ELO EPS with Convertible Bonds On June Andre Company and Agassi Company merged to form Lancaster Inc. A total of shares were issued to complete the merger. The
new corporation reports on a calendaryear basis.
On April the company issued an additional shares of stock for cash. All shares were outstanding on December
Lancaster Inc. also issued $ of year, convertible bonds at par on July Each $ bond converts to shares of common at any interest date. None of the bonds have been converted to
date.
Lancaster Inc. is preparing its annual report for the fiscal year ending December The annual report will show earnings per share figures based upon a reported aftertax net income of $
The tax rate is
Instructions
Determine the following for
a The number of shares to be used for calculating:
Basic earnings per share.
Diluted earnings per share.
b The earnings figures to be used for calculating:
Basic earnings per share.
Diluted earnings per share.
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