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Please provide basic work and answers for the question below, thanks!! ABC Corp. reported net income of $1,692,900 for 2017. ABC's income tax rate was
Please provide basic work and answers for the question below, thanks!!
ABC Corp. reported net income of $1,692,900 for 2017. ABC's income tax rate was 30% and they reported no below the line items on their income statement. ABC had 400,000 shares of common stock outstanding at1/01/17, issued an additional 300,000 shares on 7/1/17, and purchased 90,000 treasury shares on 11/1/17. The average market price of ABC's stock during 2017 was $50. Throughout 2017 ABC also had the following securities outstanding: 20,000 shares of $100 par value 6% cumulative preferred stock (annual preferred dividend requirement of $6/share). Each preferred share is convertible into 3 shares of common stock. $10,000,000 of 8% bonds payable issued at face value. Each $1,000 bond is convertible into 20 shares of common stock. c. Stock warrants to purchase 160,000 shares of ABC Corp. common stock for $40/share. Required 1. Calculate basic EPS for 2017 (show your work - answer should be $2.94/share), 2. Determine diluted EPS for 2017 (in formulating your answer, provide the "incremental effect" on the EPS numerator and denominator for each of the potentially dilutive securities a, b and c above)Step by Step Solution
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