#27 ABC Company started operations way back in the year 2000. The entity’s capital structure consistently consisted of 200,000 P 20 par ordinary shares until the end of 2020. Other relevant information follows: - Towards the end of 2020, the company issued stock options to purchase 10,000 ordinary shares at P 30 per share. At the time the options were issued, the market price per share was P 45. Average market price per share during 2021 was P 48. None of the options were exercised in 2021. - On February 1, 2021, ABC Company issued for cash 20,000 shares of P 100 par, 12% cumulative preference shares. Each preference share is convertible into two ordinary shares. - 10% bonds with face amount of P 2,000,000 are outstanding throughout the year 2021. Each 5,000 bond is convertible into 100 ordinary shares. - Profit for 2021 amounted to P 2,800,000 and income tax rate is 30%. For 2021 diluted earnings per share, what is the sequence of the potential ordinary shares starting from the least dilutive? Group of answer choices Convertible preference shares, convertible bonds payable and share options Share options, convertible preference shares and convertible bonds payable Share options, convertible bonds payable and convertible preference shares Convertible bonds payable, convertible preference shares and share options
#27
ABC Company started operations way back in the year 2000. The entity’s capital structure consistently consisted of 200,000 P 20 par ordinary shares until the end of 2020. Other relevant information follows:
- Towards the end of 2020, the company issued stock options to purchase 10,000 ordinary shares at P 30 per share. At the time the options were issued, the market price per share was P 45. Average market price per share during 2021 was P 48. None of the options were exercised in 2021.
- On February 1, 2021, ABC Company issued for cash 20,000 shares of P 100 par, 12% cumulative preference shares. Each
- 10% bonds with face amount of P 2,000,000 are outstanding throughout the year 2021. Each 5,000 bond is convertible into 100 ordinary shares.
- Profit for 2021 amounted to P 2,800,000 and income tax rate is 30%.
For 2021 diluted earnings per share, what is the sequence of the potential ordinary shares starting from the least dilutive?
Group of answer choices
Convertible preference shares, convertible bonds payable and share options
Share options, convertible preference shares and convertible bonds payable
Share options, convertible bonds payable and convertible preference shares
Convertible bonds payable, convertible preference shares and share options
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