Homework Help is Here – Start Your Trial Now!
Business
Accounting
0% convertible bonds (each $1,000 bond is convertible into 20 common shares) % convertible $100 par value preferred shares (each share is convertible into 2 common shares) $100,000 $45,000

0% convertible bonds (each $1,000 bond is convertible into 20 common shares) % convertible $100 par value preferred shares (each share is convertible into 2 common shares) $100,000 $45,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
See similar textbooks
icon
Related questions
Question
Do not give image format
Blossom Corporation is preparing earnings per share data for 2020. The net income for the year ended December 31, 2020, was $390,000 and there were 58,000 common shares outstanding during the entire year. Blossom has the following two convertible securities outstanding: 10% convertible bonds (each $1,000 bond is convertible into 20 common shares) 3% convertible $100 par value preferred shares (each share is convertible into 2 common shares) $100,000 $45,000 Both convertible securities were issued at face value in 2017. Blossom's income tax rate is 24%. The preferred shares are cumulative. For simplicity, ignore the requirement to record the debt and equity components of the bonds separately. Assume that 40% of the convertible bonds were converted to common shares on April 1, 2020. The balances at December 31, 2020 do not reflect the conversion of April 1, 2020. Calculate Blossom's weighted average common shares outstanding.
Transcribed Image Text:Blossom Corporation is preparing earnings per share data for 2020. The net income for the year ended December 31, 2020, was $390,000 and there were 58,000 common shares outstanding during the entire year. Blossom has the following two convertible securities outstanding: 10% convertible bonds (each $1,000 bond is convertible into 20 common shares) 3% convertible $100 par value preferred shares (each share is convertible into 2 common shares) $100,000 $45,000 Both convertible securities were issued at face value in 2017. Blossom's income tax rate is 24%. The preferred shares are cumulative. For simplicity, ignore the requirement to record the debt and equity components of the bonds separately. Assume that 40% of the convertible bonds were converted to common shares on April 1, 2020. The balances at December 31, 2020 do not reflect the conversion of April 1, 2020. Calculate Blossom's weighted average common shares outstanding.
Expert Solution
steps

Step by step

Solved in 3 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Earning per share and Dilutive securities
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education
SEE MORE TEXTBOOKS