Chapter 15 Homework Question 9 of 10 - /0.2 On June 1, 2023, Andre Company and Agassi Company merged to form Lancaster Inc. A total of 800, 000 shares were issued to complete the merger. The new corporation reports on a calendar - year basis. Lancaster Inc. also issued $600,000 of 20-year, 8% convertible bonds at par on July 1, 2025. Each $1,000 bond converts to 40 shares of common at any interest date. None of the bonds have been converted to date. Lancaster Inc. is preparing its annual report for the fiscal year ending December 31, 2025. The annual report will show earnings per share figures based upon a reported after-tax net income of $1,540, 000. (The tax rate is 20% .) Determine the following for 2025. a. The number of shares to be used for calculating: (Round answers to 0 decimal places, e.g. 2,500.) 1. Basic earnings per share shares 2. Diluted earnings per share shares b. The earnings figures to be used for calculating: (Round answers to 0 decimal places, e.g. 2,500.) 1. Basic earnings per share $ 2. Diluted earnings per share $

Chapter 15 Homework Question 9 of 10 - /0.2 On June 1, 2023, Andre Company and Agassi Company merged to form Lancaster Inc. A total of 800, 000 shares were issued to complete the merger. The new corporation reports on a calendar - year basis. Lancaster Inc. also issued $600,000 of 20-year, 8% convertible bonds at par on July 1, 2025. Each $1,000 bond converts to 40 shares of common at any interest date. None of the bonds have been converted to date. Lancaster Inc. is preparing its annual report for the fiscal year ending December 31, 2025. The annual report will show earnings per share figures based upon a reported after-tax net income of $1,540, 000. (The tax rate is 20% .) Determine the following for 2025. a. The number of shares to be used for calculating: (Round answers to 0 decimal places, e.g. 2,500.) 1. Basic earnings per share shares 2. Diluted earnings per share shares b. The earnings figures to be used for calculating: (Round answers to 0 decimal places, e.g. 2,500.) 1. Basic earnings per share $ 2. Diluted earnings per share $

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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Exercise 16-04 On January 1, 2019, when its $30 par value common stock was selling for $80 per share, Wildhorse Corp. issued $12,100,000 of 8% convertible debentures due in 20 years. The conversion option allowed the holder of each $1,000 bond to convert the bond into five shares of the corporation’s common stock. The debentures were issued for $13,068,000. The present value of the bond payments at the time of issuance was $10,285,000, and the corporation believes the difference between the present value and the amount paid is attributable to the conversion feature. On January 1, 2020, the corporation’s $30 par value common stock was split 2 for 1, and the conversion rate for the bonds was adjusted accordingly. On January 1, 2021, when the corporation’s $15 par value common stock was selling for $135 per share, holders of 30% of the convertible debentures exercised their conversion options. The corporation uses the straight-line method for amortizing any bond discounts or premiums.(a)…
PROBLEM NO. 2 On January 1, 2023, Legis Company issued 10-year, P200,000 face value, 6% bonds at par (payable annually on January 1). Each P1,000 bond is convertible into 30 shares of Legis P2 par value ordinary shares. The company has had 10,000 ordinary shares (and no preference shares) outstanding throughout its life. None of the bonds have been converted as of the end of 2024. Legis also adopted a share-option plan that granted options to key executives to purchase 4,000 shares of the company's ordinary shares. The options were granted on January 2, 2023, and were exercisable 2 years after the date of grant if the grantee was still an employee of the company (the service period is 2 years). The options expire 6 years from the date of grant. The option price was set at P4, and the fair value option pricing model determines the total compensation expense to be P18,000. All of the options were exercised during the year 2025: 3,000 on January 3 when the market price was P6, and 1,000…
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Problem 5 On January 1, 2022, Luffy Company issued 500 of its 5-year, 10% P1,000 face value bonds at 112. Each bond includes a warrant that allows the holder to purchase 20 ordinary shares with par value P100 at P110 per share. The market value of the bond ex-warrant at the time of issuance is 98. The amount assigned to the share warrants outstanding upon issuance is P70,000. Required: (assume the following independent cases): 12. If 60% of the warrants were exercised and the rest were expired, compute for the amount to be credited to Share premium immediately after the exercise of the said warrants. 13. If all warrants were exercise, compute for the amount to be credited to Share premium immediately after the exercise of the said warrants. Can you show the solutions? The answers are: 12. 102,000 13. 170,000
37 A company issues a $1,000 bond that is convertible into 100 shares of common stock with a par value of $1. At conversion, the Accumulated Discount on Bonds Payable is $100. What information should be included in the journal entry for the conversion? Debit Bonds Payable for $1,000 Credit Common Stock for $1,000 Credit Paid-in Capital in Excess of Par-Common Stock for $100 O Debit Discount on Bonds Payable for $100 NEXT > BOOKMARK
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View Policies Current Attempt in Progress Sunland Co. has 4770000 shares of common stock outstanding on December 31, 2024. An additional 204000 shares are issued on April 1, 2025, and 486000 more on September 1. On October 1, Sunland issued $5970000 of 8% convertible bonds. Each $1,000 bond is convertible into 40 shares of its common stock. No bonds have been converted. The number of shares to be used in computing basic earnings per share and diluted earnings per share, respectively, on December 31, 2025 are O 5085000 and 5085000. O 5865300 and 5297700. 5085000 and 5144700. 5085000 and 2982300.
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Problem no. 1 ABC Corporation has the following transactions throughout the year of 2020: Jan ABC Corporation received its certificate of incorporation from Securities and Exchange Commission. From its submitted Articles of Incorporation, the corporation has a total of authorized share capital of PI0,000,000.00 divided into 1,000,000 ordinary shares with par value of P10.00. Out of the total authorized share capital, 30% has been fully paid and issued at P11.00 per share to incorporators. The company incurred P120,000 directly related to the issuance of shares. Feb 2 Mr. Z, an investor, subscribed 20,000 shares at a subscription price of P15.00. ABC has collected 20% of the total subscription price and remaining balance payable within 10 days. 5 ABC issued 140,000 shares at P17.00 per share. ABC issued 40,000 shares in exchange for equipment. The fair value of the shares is P11.00 and the fair value of the equipment is P480,000. 28 ABC issued 30,000 shares for payment of legal…
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