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at December 31, 2016, Talbot corporation had 90,000 shares of common stock and 20,000 shares of convertible preferred stock outstanding in addition to 9% convertible bonds payable in the face amount of 2,000,000. During 2016, Talbot paid dividends of $2.50 per share on the preferred stock. The preferred stock is convertible into 30,000 shares of common stock. New income for 2016 was $970,000. Assume an income tax rate of 30%. How much is the diluted earnings per share for the year ended December 31, 2016?

at December 31, 2016, Talbot corporation had 90,000 shares of common stock and 20,000 shares of convertible preferred stock outstanding in addition to 9% convertible bonds payable in the face amount of 2,000,000. During 2016, Talbot paid dividends of $2.50 per share on the preferred stock. The preferred stock is convertible into 30,000 shares of common stock. New income for 2016 was $970,000. Assume an income tax rate of 30%. How much is the diluted earnings per share for the year ended December 31, 2016?

FINANCIAL ACCOUNTING
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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at December 31, 2016, Talbot corporation had 90,000 shares of common stock and 20,000 shares of convertible preferred stock outstanding in addition to 9% convertible bonds payable in the face amount of 2,000,000. During 2016, Talbot paid dividends of $2.50 per share on the preferred stock. The preferred stock is convertible into 30,000 shares of common stock. New income for 2016 was $970,000. Assume an income tax rate of 30%. How much is the diluted earnings per share for the year ended December 31, 2016?
Transcribed Image Text:at December 31, 2016, Talbot corporation had 90,000 shares of common stock and 20,000 shares of convertible preferred stock outstanding in addition to 9% convertible bonds payable in the face amount of 2,000,000. During 2016, Talbot paid dividends of $2.50 per share on the preferred stock. The preferred stock is convertible into 30,000 shares of common stock. New income for 2016 was $970,000. Assume an income tax rate of 30%. How much is the diluted earnings per share for the year ended December 31, 2016?
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