During the current year, North Corporation had 2 million shares of common stock outstanding. Two thousand 10% convertible bonds, each with $1,000 face value, were issued at face amount at the beginning of the year. East reported net income of $2 million for the year. Each bond is convertible into 10 shares of common stock. The tax rate is 25%. What is diluted EPS (rounded)? A. $1.00. B. $0.90. C. $0.95. D. $1.10.
During the current year, North Corporation had 2 million shares of common stock outstanding. Two thousand 10% convertible bonds, each with $1,000 face value, were issued at face amount at the beginning of the year. East reported net income of $2 million for the year. Each bond is convertible into 10 shares of common stock. The tax rate is 25%. What is diluted EPS (rounded)? A. $1.00. B. $0.90. C. $0.95. D. $1.10.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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During the current year, North Corporation had 2 million shares of common stock outstanding. Two thousand 10% convertible bonds, each with $1,000 face value, were issued at face amount at the beginning of the year. East reported net income of $2 million for the year. Each bond is convertible into 10 shares of common stock. The tax rate is 25%. What is diluted EPS (rounded)?
A. $1.00.
B. $0.90.
C. $0.95.
D. $1.10.
-3-
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