Paltel Group has the following Earnings and Securities: Net income for 2020 $450,000 100,000 Weighted average common shares outstanding during 2020 1. Series (A) 10% five-year convertible bonds were issuod on January 1, 2019 with a face value of $200,000 @ 96 %. The bonds are issued to yield 11%, interest is paid annually. Each bond is convertible into 22 shares of common stock. 2. Series (B) 12% five-year convertible bonds were issued on June 1, 2020 with a face value of $400,000 @ 100%. Each bond is convertible into 36 shares of common stock. No bonds or preferred stocks were converted during 2020. The tax rate is 30%.

Paltel Group has the following Earnings and Securities: Net income for 2020 $450,000 100,000 Weighted average common shares outstanding during 2020 1. Series (A) 10% five-year convertible bonds were issuod on January 1, 2019 with a face value of $200,000 @ 96 %. The bonds are issued to yield 11%, interest is paid annually. Each bond is convertible into 22 shares of common stock. 2. Series (B) 12% five-year convertible bonds were issued on June 1, 2020 with a face value of $400,000 @ 100%. Each bond is convertible into 36 shares of common stock. No bonds or preferred stocks were converted during 2020. The tax rate is 30%.

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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