The following information was taken from the books and records of Ludwick, Inc.:
1. Net Income ......................... $418,000
2. Capital Structure
a. Convertible 6% bonds. Each of the 350, $1,000 bonds is convertible into 50 shares of common stock at the present date and for the next 10 years. .................350,000
b. $10 par common stock, 180,000 shares issued and outstanding during the entire year. ....................................................................................... 1,800,000
c. Stock warrants outstanding to buy 15,200 shares of common stock at $20 per share.
3. Other Information:
a. Bonds converted during the year..................................................None
b. Income tax rate.......................................................................30%
c. Convertible debt was outstanding the entire year
d. Average market price per share of common stock during the year.............$32
e. Warrants were outstanding the entire year
f. Warrants exercised during the year..............................................None