Studen ) A company with convertible bonds outstanding will assume hypothetical conversion at the earliest poin the year to compute EPS. The numerator is A) increased by the after-tax interest expense for the fiscal year B) decreased by the after-tax interest paid during the fiscal year C) increased by the interest paid during the fiscal vear D) decreased by the interest paid during the fiscal year 7) ABC Engineering experienced net income of S500,000 for the year. It declared $45,000 in preferred dividends on December 23. It began the year with 700,000 common shares outstanding. On July 1, ABC declared a 10% common stock dividend. Compute the weighted-average common shares outstanding for the year. A) 770,000 B) 840,000 C) 630,000 D) 700,000 8) ABC Engineering experienced net income of $425,000 for the year. It declared $45,000 in preferred dividends on December 23. It began the year with 600,000 common shares outstanding. On July 1, ABC declared a 5% common stock dividend. Compute the basic EPS for the year. (Round your answer to the nearest cent.) A) S0.63 B) $0.67 C) $0.62 D) S0.60 9) ABC Company had 40,000 shares of common stock outstanding on January 1, 2018. On April 1, 2018, the company issued 20,000 shares of common stock. The company had outstanding fully vested incentive stock options for 10,000 shares exercisable at $10 that had not been exercised by its executives. The average market price of common stock for the year was $12. What number of shares of stock (rounded) should be used in computing diluted earnings per share? A) 65,000. B) 55,000. C) 46,667. D) 56,667. 10) ABC Inc. reported net earnings of $300,000 for the year. Harvey has 200,000 shares of common stock outstanding all year. Two years ago the company granted 20,000 stock options that allow employees to purchase shares for $15 each. The company stock has averaged $20 in the market during the year. Compute the basic and diluted EPS. A) basic EPS $1.46; diluted EPS $1.46 B) basic EPS $1.50; diluted EPS$1.46 C) basic EPS $1.50; diluted EPS $1.00 D) basic EPS $1.50; diluted EPS $1.50 7) ABC Engineering experienced net income of $500,000 for the year. It declared $45,000 in preferred dividends on December 23. It began the year with 700,000 common shares outstanding. On July 1, ABC declared a 10% common stock dividend. Compute the weighted-average common shares outstanding for the year. A) 770,000 B) 840,000 C) 630,000 D) 700,000 8) ABC Engineering experienced net income of $425,000 for the year. It declared $45,000 in preferred dividends on December 23. It began the year with 600,000 common shares outstanding. On July 1, ABC declared a 5% common stock dividend. Compute the basic EPS for the year. (Round your answer to the nearest cent.) A) $0.63 B) $0.67 C) $0.62 D) $0.60 9) ABC Company had 40,000 shares of common stock outstanding on January 1, 2018. On April 1, 2018, the company issued 20,000 shares of common stock. The company had outstanding fully vested incentive stock options for 10,000 shares exercisable at $10 that had not been exercised by its executives. The average market price of common stock for the year was $12. What number of shares of stock (rounded) should be used in computing diluted earnings per share? A) 65,000. B) 55,000. C) 46,667. D) 56,667. 10) ABC Inc. reported net earnings of $300,000 for the year. Harvey has 200,000 shares of common stock outstanding all year. Two years ago the company granted 20,000 stock options that allow employees to purchase shares for $15 each. The company stock has averaged $20 in the market during the year. Compute the basic and diluted EPS. A) basic EPS $1.46; diluted EPS $1.46 B) basic EPS $1.50; diluted EPS$1.46 C) basic EPS $1.50; diluted EPS $1.00 D) basic EPS $1.50; diluted EPS $1.50