Pagsanjan Company reported the following capital structure at year-end: 2020 2021 Outstanding shares: Ordinary Convertible preference 10% convertible bonds payable 600,000 100,000 P3,000,000 500,000 100,000 P3,000,000 During 2021, the entity paíd the annual dividend of P5 on preference share. The preference shares are convertíble into 200,000 ordinary shares and the 10% bonds are convertible into 100,000 ordinary shares. The net income for the current year was P5,000,000. The income tax rate is 30%. Required: 1. Basic earnings per share 2. Diluted earnings per share
Pagsanjan Company reported the following capital structure at year-end: 2020 2021 Outstanding shares: Ordinary Convertible preference 10% convertible bonds payable 600,000 100,000 P3,000,000 500,000 100,000 P3,000,000 During 2021, the entity paíd the annual dividend of P5 on preference share. The preference shares are convertíble into 200,000 ordinary shares and the 10% bonds are convertible into 100,000 ordinary shares. The net income for the current year was P5,000,000. The income tax rate is 30%. Required: 1. Basic earnings per share 2. Diluted earnings per share
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:Pagsanjan Company reported the following capital structure
at year-end:
2020
2021
Outstanding shares:
Ordinary
Convertible preference
10% convertible bonds payable
600,000
100,000
P3,000,000
500,000
100,000
P3,000,000
During 2021, the entity paid the annual dividend of P5 on
preference share.
The preference shares are convertíble into 200,000 ordinary
shares and the 10% bonds are convertible into 100,000
ordinary shares.
The net income for the current year was P5,000,000. The
income tax rate is 30%.
Required:
1. Basic earnings per share
2. Diluted earnings per share
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