QUESTION 1 SECTION 1 The Eubanks Corporation held the following potentially dilutive contracts at some point during the fiscal year ended December 31, YR7 Security Par Face Amount Date Issued Conversion Terms 8% convertible bonds issued at par $2,000,000 11 YRS 20 shares of common stock for each $1,000 bond 6% coevertible, cumulative and nonparticipating preferred stock $3,000,000 71 YR 3 shares of common stock for each $1,000 of preferred stock convertible bonds of inod at par $1,500,000 11 YR6 40 shares of common stock for each $1,000 bond Stock options to purchase 50,000 shares of Common stock at $20 per share (options were granted in YRA and became fally vested in YRG). Average common stock price during YR 7 is 525 per share The 7% convertible bonds mature 3 year from the insue date, and were sold when the market rate for these bonds was % Interest on these bonds is payable semi-annually. The company wes the effective interest method to amortize the discount associated with this bond. Net Income for YR7 - $1,200,000 Tax rate for YR7 -40% No dividends were declared in 1R7. . On January 1, YR7,600,000 shares of Eubanks Corporation common stock were outstanding on February 1, YR" the firm is an additional 100.000 shares of common stock. On November 1, YR7, the firm repurchased 75,000 shares as treasury stock, and on December 1, YR7, the firm declared a 20. stock dividend Cakulate weighted average common shares outstanding Note 1. Do NOT use a comma (thousands separator) Note 2. Only put a numerator for "months" columns Date Shares Ady Factor Months WA Common Shares Outstanding 11-21 12 21.111 12 111-121 121-1231 12 Question Completion Status: QUESTION 2 Calculate Basic EPS. Round EPS numbers up to the nearest penny. Note 1. Do NOT use a comma (thousands separator). 1 QUESTION 3 Calculate an ME for for the 8% convertible bonds. Note: Do NOT use a comma (thousands separator). QUESTION 4 Calculate an ME for for the 6% convertible, cumulative, nonparticipating preferred stock. Note: Do NOT use a comma (thousands separator). QUESTION 5 Question Completion Status: QUESTION 5 Calculate an ME for the 7% convertible bonds by filling in the effective interest table below. Note 1: Do NOT use a comma (thousands separator). Note 2: Round up to the whole number. Date Interest PMT Interest Expense Discount on B/P Carrying Value 1/1/YR6 6/30/YR6 12/31/YR6 6/30/YR7 12/31/YR7 ME for the 7% convertible bonds. QUESTION 6 Calculate an ME for for the stock option. Note: Do NOT use a comma (thousands separator). QUESTION 8 SECTION 2 Consider the following Balance Sheet and Income Statement information: Balance Sheet Information Cash Accounts Receivable Rent Receivable Interest Receivable Inventory Prepaid Insurance Building and Equipment Accumulated Depreciation Total Assets 12/31/YR10 12/31 YR9 125,150 105,800 60,000 10,000 700 600 2,000 6,000 10,000 20,000 2,000 1,000 1.250 2,500 (400) (900) 200,700 145,000 Accounts Payable Salaries Payable Unearned Revenue Taxes Payable Interest Payable Bonds Payable Common Stock Retained Earnings Total Liab and Equity 35,000 10,000 6,000 9,000 300 9,100 111,300 20.000 200,700 20,000 5,000 4,000 5,000 0 0 101,000 19.000 145,000 QUESTION 1 SECTION 1 The Eubanks Corporation held the following potentially dilutive contracts at some point during the fiscal year ended December 31, YR7 Security Par Face Amount Date Issued Conversion Terms 8% convertible bonds issued at par $2,000,000 11 YRS 20 shares of common stock for each $1,000 bond 6% coevertible, cumulative and nonparticipating preferred stock $3,000,000 71 YR 3 shares of common stock for each $1,000 of preferred stock convertible bonds of inod at par $1,500,000 11 YR6 40 shares of common stock for each $1,000 bond Stock options to purchase 50,000 shares of Common stock at $20 per share (options were granted in YRA and became fally vested in YRG). Average common stock price during YR 7 is 525 per share The 7% convertible bonds mature 3 year from the insue date, and were sold when the market rate for these bonds was % Interest on these bonds is payable semi-annually. The company wes the effective interest method to amortize the discount associated with this bond. Net Income for YR7 - $1,200,000 Tax rate for YR7 -40% No dividends were declared in 1R7. . On January 1, YR7,600,000 shares of Eubanks Corporation common stock were outstanding on February 1, YR" the firm is an additional 100.000 shares of common stock. On November 1, YR7, the firm repurchased 75,000 shares as treasury stock, and on December 1, YR7, the firm declared a 20. stock dividend Cakulate weighted average common shares outstanding Note 1. Do NOT use a comma (thousands separator) Note 2. Only put a numerator for "months" columns Date Shares Ady Factor Months WA Common Shares Outstanding 11-21 12 21.111 12 111-121 121-1231 12 Question Completion Status: QUESTION 2 Calculate Basic EPS. Round EPS numbers up to the nearest penny. Note 1. Do NOT use a comma (thousands separator). 1 QUESTION 3 Calculate an ME for for the 8% convertible bonds. Note: Do NOT use a comma (thousands separator). QUESTION 4 Calculate an ME for for the 6% convertible, cumulative, nonparticipating preferred stock. Note: Do NOT use a comma (thousands separator). QUESTION 5 Question Completion Status: QUESTION 5 Calculate an ME for the 7% convertible bonds by filling in the effective interest table below. Note 1: Do NOT use a comma (thousands separator). Note 2: Round up to the whole number. Date Interest PMT Interest Expense Discount on B/P Carrying Value 1/1/YR6 6/30/YR6 12/31/YR6 6/30/YR7 12/31/YR7 ME for the 7% convertible bonds. QUESTION 6 Calculate an ME for for the stock option. Note: Do NOT use a comma (thousands separator). QUESTION 8 SECTION 2 Consider the following Balance Sheet and Income Statement information: Balance Sheet Information Cash Accounts Receivable Rent Receivable Interest Receivable Inventory Prepaid Insurance Building and Equipment Accumulated Depreciation Total Assets 12/31/YR10 12/31 YR9 125,150 105,800 60,000 10,000 700 600 2,000 6,000 10,000 20,000 2,000 1,000 1.250 2,500 (400) (900) 200,700 145,000 Accounts Payable Salaries Payable Unearned Revenue Taxes Payable Interest Payable Bonds Payable Common Stock Retained Earnings Total Liab and Equity 35,000 10,000 6,000 9,000 300 9,100 111,300 20.000 200,700 20,000 5,000 4,000 5,000 0 0 101,000 19.000 145,000