Information relating to the capital structure of the Magdalene Corporation at December 31, 2012 is as follows: Ordinary share capital 120,000 shares Convertible preference share capital, non-cumulative 18,000 shares 7.5% convertible bonds (liability component) P1,200,000 Stock options to purchase 20,000 shares at an option price of P15. The average market price on December 31, 2012 is P20. The company paid dividends of P5 per share on its preference share. The preference share is convertible into 40,000 shares of ordinary share. The 7.5% convertible bonds are convertible into 35,000 shares of ordinary. The net income for the year ended December 31, 2012 is P640,000. Income tax rate is 32%. What is the diluted earnings per share for the year 2012? a. 3.51 c. 4.25 b. 3.60 d. 4.58
Information relating to the capital structure of the Magdalene Corporation at December 31, 2012 is as follows: Ordinary share capital 120,000 shares Convertible preference share capital, non-cumulative 18,000 shares 7.5% convertible bonds (liability component) P1,200,000 Stock options to purchase 20,000 shares at an option price of P15. The average market price on December 31, 2012 is P20. The company paid dividends of P5 per share on its preference share. The preference share is convertible into 40,000 shares of ordinary share. The 7.5% convertible bonds are convertible into 35,000 shares of ordinary. The net income for the year ended December 31, 2012 is P640,000. Income tax rate is 32%. What is the diluted earnings per share for the year 2012? a. 3.51 c. 4.25 b. 3.60 d. 4.58
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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0. Information relating to the capital structure of the Magdalene Corporation at December 31, 2012 is as
follows:
Ordinary share capital 120,000 shares
Convertible preference share capital, non-cumulative 18,000 shares
7.5% convertible bonds (liability component) P1,200,000
Stock options to purchase 20,000 shares at an option price of P15. The average market
price on December 31, 2012 is P20.
The company paid dividends of P5 per share on its preference share. The preference share is convertible into
40,000 shares of ordinary share. The 7.5% convertible bonds are convertible into 35,000 shares of ordinary.
The net income for the year ended December 31, 2012 is P640,000. Income tax rate is 32%. What is the
diluted earnings per share for the year 2012?
a. 3.51 c. 4.25
b. 3.60 d. 4.58
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