Computing consolidated earnings per share (EPS)Assume the following facts about a parent and its 75% owned subsidiary company.ParentNet income$180,000Common shares outstanding50,000Convertible preferred stock Dividends - $17,100Convertible bondsConvertible into 9,000 shares of common stocka. Compute basic earnings per share$ 3.93b. Compute diluted earnings per share$ 3.62xSubsidiary$45,00022,000 (16,500-75% owned by pareInterest expere after tax-$7,200Convertible into 4,500 shares of common stock

Here we need to calculate the EPS and diluted EPS for the parent company. EPS (Parent) = ((Net…

Computing consolidated earnings per share (EPS) Assume the following facts about a parent and its 75% owned subsidiary company: Parent Net income Common shares outstanding Convertible preferred stock Dividends-$17,100 Convertible bonds $180,000 50,000 Convertible into 0,000 shares of common stock a. Compute basic earnings per share 3.93 x b. Compute diluted earnings per share $ 3.62 Subsidiary $45,000 22,000 (16.500- 75 owned by par Interest expere after lan-$7,200 Convertible into 4,500 shares of common stock

Computing consolidated earnings per share (EPS) Assume the following facts about a parent and its 75% owned subsidiary company: Parent Net income Common shares outstanding Convertible preferred stock Dividends-$17,100 Convertible bonds $180,000 50,000 Convertible into 0,000 shares of common stock a. Compute basic earnings per share 3.93 x b. Compute diluted earnings per share $ 3.62 Subsidiary $45,000 22,000 (16.500- 75 owned by par Interest expere after lan-$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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Concept explainers

Consolidation

Consolidation in general examination implies an asset oscillating between well-defined methods of trading status. Consolidation is commonly known as market indecisiveness, which completes when the asset's values move forward or backward the trading structure.

Question

100%

Computing consolidated earnings per share (EPS)
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
$ 3.93
b. Compute diluted earnings per share
$ 3.62
x
Subsidiary
$45,000
22,000 (16,500-75% owned by pare
Interest expere after tax-$7,200
Convertible into 4,500 shares of common stock

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