On December 31, 2020, Vitners Company had outstanding 400,000 shares of common stock. There were also 40,000 shares of 8% cumulative preferred stock (par $10). $10). Other items were: • February 28, 2021, issued an additional 36,000 shares of common stock September 1, 2021, 9,000 shares were repurchased into treasury. • A 10% stock dividend was declared and distributed on July 1, 2021. • At the beginning of 2021, there were fully vested incentive stock options outstanding for 30,000 shares of common stock (adjusted for the stock dividend). The exercise price was $18. The market price of the common stock averaged $20 during the year. • Also outstanding were $1,000,000 face amount of 10% convertible bonds issued in 2018 and convertible into 50,000 common shares (adjusted for the stock dividend). • Net income was $900,000. The tax rate for the year was 25%. Required: Compute basic and diluted EPS (rounded to 4 decimal places) for the year ended December 31, 2021.

On December 31, 2020, Vitners Company had outstanding 400,000 shares of common stock. There were also 40,000 shares of 8% cumulative preferred stock (par $10). $10). Other items were: • February 28, 2021, issued an additional 36,000 shares of common stock September 1, 2021, 9,000 shares were repurchased into treasury. • A 10% stock dividend was declared and distributed on July 1, 2021. • At the beginning of 2021, there were fully vested incentive stock options outstanding for 30,000 shares of common stock (adjusted for the stock dividend). The exercise price was $18. The market price of the common stock averaged $20 during the year. • Also outstanding were $1,000,000 face amount of 10% convertible bonds issued in 2018 and convertible into 50,000 common shares (adjusted for the stock dividend). • Net income was $900,000. The tax rate for the year was 25%. Required: Compute basic and diluted EPS (rounded to 4 decimal places) for the year ended December 31, 2021.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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