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On January 1, 2025, Whispering Company issued 10-year, $2,090,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 14 shares of Whispering common stock. Whispering's net income in 2025 was $459,550, and its tax rate was 20%. The company had 101,000 shares of common stock outstanding throughout 2025. None of the bonds were converted in 2025. a. Compute diluted earnings per share for 2025. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $

On January 1, 2025, Whispering Company issued 10-year, $2,090,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 14 shares of Whispering common stock. Whispering's net income in 2025 was $459,550, and its tax rate was 20%. The company had 101,000 shares of common stock outstanding throughout 2025. None of the bonds were converted in 2025. a. Compute diluted earnings per share for 2025. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $

FINANCIAL ACCOUNTING
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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On January 1, 2025, Whispering Company issued 10-year, $2,090,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 14 shares of Whispering common stock. Whispering's net income in 2025 was $459,550, and its tax rate was 20%. The company had 101,000 shares of common stock outstanding throughout 2025. None of the bonds were converted in 2025. a. Compute diluted earnings per share for 2025. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $ b. Compute diluted earnings per share for 2025, assuming the same facts as above, except that $1,010,000 of 6% convertible preferred stock was issued instead of the bonds. Each $100 preferred share is convertible into 5 shares of Whispering common stock. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $
Transcribed Image Text:On January 1, 2025, Whispering Company issued 10-year, $2,090,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 14 shares of Whispering common stock. Whispering's net income in 2025 was $459,550, and its tax rate was 20%. The company had 101,000 shares of common stock outstanding throughout 2025. None of the bonds were converted in 2025. a. Compute diluted earnings per share for 2025. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $ b. Compute diluted earnings per share for 2025, assuming the same facts as above, except that $1,010,000 of 6% convertible preferred stock was issued instead of the bonds. Each $100 preferred share is convertible into 5 shares of Whispering common stock. (Round answer to 2 decimal places, e.g. 2.55.) Diluted earnings per share $
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