Jones Corp. had 120,000 shares outstanding all of year 8. During year 8, Jones paid dividends of $60,000 on its non-cumulative, convertible preferred Hock The convertible preferred shares may be exchanged for 20,000 of shares of common stock. The $4,000,000 face value, 6% convertible bonds (issued at par) are convertible into 120,000 shares of common stock. Net income for year 8 is $250,000 and the corporate tax rate is 40%. Security Name Convertible Preferred Shares 0% Convertible Bonds Issued at Par Value O $1.29 O $1.39 Numerator Denominator O $1.58 O $1.60 -Converted-Converted Method $60,000 What is diluted earnings per share for year 87 $144,000 Method 20,000 120,000 Per Share Effect $3.00 $1.20
Jones Corp. had 120,000 shares outstanding all of year 8. During year 8, Jones paid dividends of $60,000 on its non-cumulative, convertible preferred Hock The convertible preferred shares may be exchanged for 20,000 of shares of common stock. The $4,000,000 face value, 6% convertible bonds (issued at par) are convertible into 120,000 shares of common stock. Net income for year 8 is $250,000 and the corporate tax rate is 40%. Security Name Convertible Preferred Shares 0% Convertible Bonds Issued at Par Value O $1.29 O $1.39 Numerator Denominator O $1.58 O $1.60 -Converted-Converted Method $60,000 What is diluted earnings per share for year 87 $144,000 Method 20,000 120,000 Per Share Effect $3.00 $1.20
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 10MC
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Question
![Jones Corp. had 120,000 shares outstanding all of year 8. During year 8, Jones paid dividends of $60,000 on its non-cumulative, convertible preferred stock.
The convertible preferred shares may be exchanged for 20,000 of shares of common stock. The $4,000,000 face value, 6% convertible bonds (issued at par)
are convertible into 120,000 shares of common stock. Net income for year 8 is $250,000 and the corporate tax rate is 40%.
Security Name
Convertible Proferred Shares
6% Convertible Bonds
Issued at Par Value
O $1.29
O $1.39
O $1.58
O $1.60
4
Numerator Denominator
If-Converted f-Converted
Method
Method
$60,000
$144,000
What is diluted earnings per share for year 87
20,000
120,000
Per Share
Effect
$3.00
$1.20](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F9462e73b-722e-4a2a-8740-cd33b1d468bd%2Fa9010d83-5431-4ede-b6df-576ba279771d%2Fquv2hzq_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Jones Corp. had 120,000 shares outstanding all of year 8. During year 8, Jones paid dividends of $60,000 on its non-cumulative, convertible preferred stock.
The convertible preferred shares may be exchanged for 20,000 of shares of common stock. The $4,000,000 face value, 6% convertible bonds (issued at par)
are convertible into 120,000 shares of common stock. Net income for year 8 is $250,000 and the corporate tax rate is 40%.
Security Name
Convertible Proferred Shares
6% Convertible Bonds
Issued at Par Value
O $1.29
O $1.39
O $1.58
O $1.60
4
Numerator Denominator
If-Converted f-Converted
Method
Method
$60,000
$144,000
What is diluted earnings per share for year 87
20,000
120,000
Per Share
Effect
$3.00
$1.20
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