The following information is used in answering questions 14-20. Dr. Pepper Co. has gathered the following information to be used in developing its Earnings Per Share presentation for its annual financial statements dated December 31, YR09. Net Income for the year is $6,000 and the income tax rate is 40%. Other relevari information for the YR09 year includes: Common Stock The company began the YR09 year with 400 shares issued and outstanding. On 4-1-YR09 an additional 100 shares were issued for cash. Also, on 7-1-YR09, the company declared a 2 for 1 stock split. Convertible $2,000 of 4% convertible bonds are outstanding at 12-31-YR09. The 10 year bonds are dated 7-1-YR09, Bonds: were issued at 102 on 10-1-YR09, and pay interest each year on July 1 . Beginning on 12-1-YR12 each $1,000 bond is convertible into common stock according to the following schedule. 17. In the preliminary calculation of Diluted EPS what is the dollar amount of the adjustment to 'Income Available for Common' (numerator effect) for the convertible bonds? (Do not consider whether the bonds are dilutive, round to nearest dollar.) a. $5 b. $9 cl $12 d. $15 e. None of the above 3. In the preliminary calculation of Diluted EPS what number of additional common shares is used to adjust 'Weighted Averag Common Shares Outstanding' (denominator effect) for the convertible bonds? (Do not consider whether the bonds are dilutive, round to nearest whole share.) a. 3cs b. 4cs c. 5cs d. 10cs e. None of the above 1 the preliminary calculation of Diluted EPS what number of additional common shares is used to adjust 'Weighte ommon Shares Outstanding' (denominator effect) for the Series A Stock Options? o not consider whether the options are dilutive, round to nearest whole share.) 8cs b. 17cs c. 45cS d. 50cs e. None of the above 20. For this question you are asked to determine what amount the company would report for Diluted EPS for the year ende 12-31-YR09. To avoid the effect of carryforward errors (if any) in your prior answers use the following values in computing Diluted EPS. Given these figures, the company would report Diluted EPS of (round to nearest penny): a. $5.18 b. $5.82 c. $5.83 d. $6.00 e. None of the above. The following information is used in answering questions 14-20. Dr. Pepper Co. has gathered the following information to be used in developing its Earnings Per Share presentation for its annual financial statements dated December 31, YR09. Net Income for the year is $6,000 and the income tax rate is 40%. Other relevari information for the YR09 year includes: Common Stock The company began the YR09 year with 400 shares issued and outstanding. On 4-1-YR09 an additional 100 shares were issued for cash. Also, on 7-1-YR09, the company declared a 2 for 1 stock split. Convertible $2,000 of 4% convertible bonds are outstanding at 12-31-YR09. The 10 year bonds are dated 7-1-YR09, Bonds: were issued at 102 on 10-1-YR09, and pay interest each year on July 1 . Beginning on 12-1-YR12 each $1,000 bond is convertible into common stock according to the following schedule. 17. In the preliminary calculation of Diluted EPS what is the dollar amount of the adjustment to 'Income Available for Common' (numerator effect) for the convertible bonds? (Do not consider whether the bonds are dilutive, round to nearest dollar.) a. $5 b. $9 cl $12 d. $15 e. None of the above 3. In the preliminary calculation of Diluted EPS what number of additional common shares is used to adjust 'Weighted Averag Common Shares Outstanding' (denominator effect) for the convertible bonds? (Do not consider whether the bonds are dilutive, round to nearest whole share.) a. 3cs b. 4cs c. 5cs d. 10cs e. None of the above 1 the preliminary calculation of Diluted EPS what number of additional common shares is used to adjust 'Weighte ommon Shares Outstanding' (denominator effect) for the Series A Stock Options? o not consider whether the options are dilutive, round to nearest whole share.) 8cs b. 17cs c. 45cS d. 50cs e. None of the above 20. For this question you are asked to determine what amount the company would report for Diluted EPS for the year ende 12-31-YR09. To avoid the effect of carryforward errors (if any) in your prior answers use the following values in computing Diluted EPS. Given these figures, the company would report Diluted EPS of (round to nearest penny): a. $5.18 b. $5.82 c. $5.83 d. $6.00 e. None of the above
