KKK Company reported the following at year-end: 10% Bonds payable 1,000,000 Ordinary share capital, P100 par, 50,000 shares 5,000,000 Net income 1,730,000 The bonds are convertible into ordinary shares in the ratio of 10 ordinary shares for each P1,000 bond. The income tax rate is 30%. Questions: 1. Compute for the basic earnings per share. 2. Compute for the diluted earnings per share.
KKK Company reported the following at year-end: 10% Bonds payable 1,000,000 Ordinary share capital, P100 par, 50,000 shares 5,000,000 Net income 1,730,000 The bonds are convertible into ordinary shares in the ratio of 10 ordinary shares for each P1,000 bond. The income tax rate is 30%. Questions: 1. Compute for the basic earnings per share. 2. Compute for the diluted earnings per share.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
KKK Company reported the following at year-end:
| 10% Bonds payable | 1,000,000 |
| Ordinary share capital, P100 par, 50,000 shares | 5,000,000 |
| Net income | 1,730,000 |
The bonds are convertible into ordinary shares in the ratio of 10 ordinary shares for each P1,000 bond. The income tax rate is 30%.
Questions:
1. Compute for the basic earnings per share.
2. Compute for the diluted earnings per share.
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