9. Information relating to the capital structure of the Galaxy Company is as follows: Outstanding shares of: Dec. 31, 20x5 Dec. 31, 20x6 Ordinary shares 90,000 Convertible preference shares 9% convertible bonds 90,000 10,000 1,000,000 b. 3.92 10,000 1,000,000 During 20x6 Galaxy paid dividends of P6.00 per share on its preference shares. The preference share is convertible into 10,000 ordinary shares. The 9% convertible bonds are convertible into 30,000 ordinary shares. The profit for the year ended December 31, 20x6, is ₹485,000. The income tax rate is 50%. What should be the diluted earnings per share for the year ended December 31, 20x6? a. 3.79 d. 4.72 c. 4.08
9. Information relating to the capital structure of the Galaxy Company is as follows: Outstanding shares of: Dec. 31, 20x5 Dec. 31, 20x6 Ordinary shares 90,000 Convertible preference shares 9% convertible bonds 90,000 10,000 1,000,000 b. 3.92 10,000 1,000,000 During 20x6 Galaxy paid dividends of P6.00 per share on its preference shares. The preference share is convertible into 10,000 ordinary shares. The 9% convertible bonds are convertible into 30,000 ordinary shares. The profit for the year ended December 31, 20x6, is ₹485,000. The income tax rate is 50%. What should be the diluted earnings per share for the year ended December 31, 20x6? a. 3.79 d. 4.72 c. 4.08
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:9. Information relating to the capital structure of the Galaxy Company is as follows:
Outstanding shares of:
Dec. 31, 20x5
Dec. 31, 20x6
Ordinary shares
90,000
Convertible preference shares
9% convertible bonds
90,000
10,000
1,000,000
10,000
1,000,000
During 20x6 Galaxy paid dividends of P6.00 per share on its preference shares. The preference
share is convertible into 10,000 ordinary shares. The 9% convertible bonds are convertible into
30,000 ordinary shares. The profit for the year ended December 31, 20x6, is P485,000. The income
tax rate is 50%. What should be the diluted earnings per share for the year ended December 31,
20x6?
a. 3.79
b. 3.92
d. 4.72
c. 4.08
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