Computing consolidated earnings per share (EPS)Assume the following facts about a parent and its 75% owned subsidiary company:ParentNet incomeCommon shares outstandingConvertible preferred stockConvertible bonds$180,00050,000Dividends = $17,100Convertible into 9,000 shares of common stocka. Compute basic earnings per share$b. Compute diluted earnings per shareLASubsidiary$45,00022,000 (16,500 = 75% owned by parent)Interest expense after tax = $7,200Convertible into 4,500 shares of common stock

Given that, Net income of ; Parent = $180,000 Subsidiary = $45,000

Assume the following facts about a parent and its 75% owned subsidiary company: Parent Net income $180,000 Common shares outstanding 50,000 Convertible preferred stock Dividends = $17,100 Convertible bonds Convertible into 9,000 shares of common stock a. Compute basic earnings per share b. Compute diluted earnings per share Subsidiary $45,000 22,000 (16,500-75% owned by parent) Interest expense after tax = $7,200 Convertible into 4,500 shares of common stock

Assume the following facts about a parent and its 75% owned subsidiary company: Parent Net income $180,000 Common shares outstanding 50,000 Convertible preferred stock Dividends = $17,100 Convertible bonds Convertible into 9,000 shares of common stock a. Compute basic earnings per share b. Compute diluted earnings per share Subsidiary $45,000 22,000 (16,500-75% owned by parent) Interest expense after tax = $7,200 Convertible into 4,500 shares of common stock

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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