es Online Network Incorporated has a net income of $680,000 in the current fiscal year. There are 100,000 shares of common stock outstanding, along with convertible bonds, which have a total face value of $1.3 million. The $1.3 million is represented by 1,300 different $1,000 bonds. Each $1,000 bond pays 5 percent interest. The conversion ratio is 20. The firm is in a 20 percent tax bracket. a. Compute basic earnings per share. Note: Do not round intermediate calculations and round your answer to 2 decimal places. Basic earnings per share b. Compute diluted earnings per share. Note: Do not round intermediate calculations and round your answer to 2 decimal places. Diluted earnings per share
es Online Network Incorporated has a net income of $680,000 in the current fiscal year. There are 100,000 shares of common stock outstanding, along with convertible bonds, which have a total face value of $1.3 million. The $1.3 million is represented by 1,300 different $1,000 bonds. Each $1,000 bond pays 5 percent interest. The conversion ratio is 20. The firm is in a 20 percent tax bracket. a. Compute basic earnings per share. Note: Do not round intermediate calculations and round your answer to 2 decimal places. Basic earnings per share b. Compute diluted earnings per share. Note: Do not round intermediate calculations and round your answer to 2 decimal places. Diluted earnings per share
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
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Online Network Incorporated has a net income of $680,000 in the current fiscal year. There are 100,000 shares of common stock
outstanding, along with convertible bonds, which have a total face value of $1.3 million. The $1.3 million is represented by 1,300
different $1,000 bonds. Each $1,000 bond pays 5 percent interest. The conversion ratio is 20. The firm is in a 20 percent tax bracket.
a. Compute basic earnings per share.
Note: Do not round intermediate calculations and round your answer to 2 decimal places.
Basic earnings per share
b. Compute diluted earnings per share.
Note: Do not round intermediate calculations and round your answer to 2 decimal places.
Diluted earnings per share"
Transcribed Image Text:es
Online Network Incorporated has a net income of $680,000 in the current fiscal year. There are 100,000 shares of common stock
outstanding, along with convertible bonds, which have a total face value of $1.3 million. The $1.3 million is represented by 1,300
different $1,000 bonds. Each $1,000 bond pays 5 percent interest. The conversion ratio is 20. The firm is in a 20 percent tax bracket.
a. Compute basic earnings per share.
Note: Do not round intermediate calculations and round your answer to 2 decimal places.
Basic earnings per share
b. Compute diluted earnings per share.
Note: Do not round intermediate calculations and round your answer to 2 decimal places.
Diluted earnings per share
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