Blossom Corp. had $670,000 net income in 2025. On January 1, 2025, there were 180,000 shares of common stock outstanding. OnApril 1, 18,800 shares were issued and on September 1, Blossom bought 35,400 shares of treasury stock. There are 28,000 options tobuy common stock at $40 a share outstanding. The market price of the common stock averaged $50 during 2025. The tax rate is 40%.In 2025, there were 44,000 shares of convertible preferred stock outstanding. The preferred is $100 par, pays an annual dividend of$3.50 per share, and is convertible into three shares of common stock.Blossom issued $1,800,000 of 8% convertible bonds at face value during 2024. Each $1,000 bond is convertible into 30 shares ofcommon stock.Complete the schedule and compute diluted earnings per share for 2025. (Round EPS answers to 2 decimal places, e.g. 52.75 and otheranswers to O decimal places, e.g. 5241. Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g.(45).)SecurityCommon StockOptionsBondsPreferredNetIncomeAdjustment$$AdjustedNet IncomeShai

It represents the portion of a company's profit allocated to each outstanding share of common stock.…

Answered: Blossom Corp. had $670,000 net income…

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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Ferrell Inc. recently reported net income of $8 million. It has 620,000 shares of common stock, which currently trades at $25 a share. Ferrell continues to expand and anticipates that 1 year from now, its net income will be $13.2 million. Over the next year, it also anticipates issuing an additional 62,000 shares of stock so that 1 year from now it will have 682,000 shares of common stock. Assuming Ferrell's price/earnings ratio remains at its current level, what will be its stock price 1 year from now? Do not round intermediate calculations. Round your answer to the nearest cent.
Green Thumb Nursery has 11,000 shares of stock outstanding at a market price of $18 per share. The current earnings per share are $1.47. The firm has total assets of $286,000 and total liabilities of $86,000. Next week, the firm will be repurchasing $36,000 worth of stock. Ignoring taxes, what will be the earnings per share after the stock repurchase? a) $1.797 b) $1.832 c) $1.848 d) $1.620 e) $1.883
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nku.2
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Bob's is a retail chain of specialty hardware stores. The firm has 18,000 shares of stock outstanding that are currently valued at $82 a share and provide a rate of return of 13.2 percent. The firm also has 600 bonds outstanding that have a face value of $1,000, a market price of $1,012, and a coupon rate of 9%. These bonds mature in 7 years and pay interest semiannually. The tax rate is 35%. The firm is considering expanding by building a new superstore. The superstore will require an initial investment of $9.3 million and is expected to produce cash inflows of $1.17 million annually over its 10-year life. The risks associated with the superstore are comparable to the risks of the firm's current operations. The initial investment will be depreciated on a straight-line basis to a zero book value over the life of the project. At the end of the 10 years, the firm expects to sell the superstore for an after-tax value of $4.7 million. a) What is the WACC of the firm? Show your…
Indigo Company's net income for 2025 is $641,000, and 79,000 shares of common stock were issued and outstanding during 2025. The only potentially dilutive securities outstanding were 27,000 executive stock options issued during 2024, each exercisable for one share at $19.50; none of these have been exercised. The average market price of Indigo's stock during 2025 was $25. (a) Compute diluted earnings per share. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $ (b) Assume the same facts as those assumed for part (a), except that 10,000 additional options were issued on October 1, 2025, with an exercise price of $26 (the market price of the common stock on that date). The average market price during the last 3 months of 2025 was $28.50. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $

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