Pharoah Corporation has net income for the year of $423,780 and a weighted average number of common shares outstanding duringthe period of 100,900 shares. The company has two convertible debenture bond issues outstanding. One is a 6% issue sold at 100(total $1 million) in a prior year and convertible into 20,100 common shares. The other is a 10% issue sold at 100 (total $500,000) onApril 1 of the current year and convertible into 35,700 common shares. The tax rate is 30%. Calculate basic earnings per share anddiluted earnings per share and show how they would be presented in the financial statements. (Round earnings per share answers to 2decimal places, eg 15.25)Net income for the yearEarnings per share:Basic earnings per shareDiluted earnings per shareeTextbook and MediaList of Accounts$$423700Save for Later Last saved 1 second agoSaved work will be auto-submitted on the due date. Auto-submission can take up to 10 minutes.Attempts: unlimitedSubmit AnwwerP

EPS or Earnings Per Share is a measure of company's profitability which is derived by dividing the…

Answered: Pharoah Corporation has net income for…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

See similar textbooks

Similar questions

Hoffman Corporation issued $60 million of 5%, 20-year bonds at 102. Each of the 60,000 bonds was convertible into one share of $1 par common stock. Prepare the journal entry to record the issuance of the bonds.
ABC CORPORATION HAD 800,000 SHARES OF COMMON STOCK ISSUED AND OUTSTANDING AT JANUARY 1. NO COMMON SHARES WERE ISSUED DURING THE YEAR, BUT ON JANUARY 1. ABC CORPORATION ISSUED 100.000 SHARES OF CONVERTIBLE PREFERRED STOCK. THE PREFERRED SHARES ARE CONVERTIBLE INTO 200.000 SHARES OF COMMON STOCK. DURINGTHE YEAR ABC CORPORATION PAID S60, 000 CASH DIVIDENDS ON THE PREFERRED STOCK. NET INCOME WAS $1,500,000. WHAT WERE ABC CORPORATION'S BASIC AND DILUTEDEARNINGS PER SHARE FOR THE YEAR?
Jones Corp. had 120,000 shares outstanding all of year 8. During year 8, Jones paid dividends of $60,000 on its non-cumulative, convertible preferred stock. The convertible preferred shares may be exchanged for 20,000 of shares of common stock. The $4,000,000 face value, 6% convertible bonds (issued at par) are convertible into 120,000 shares of common stock. Net income for year 8 is $250,000 and the corporate tax rate is 40%. Security Name Convertible Proferred Shares 6% Convertible Bonds Issued at Par Value O $1.29 O $1.39 O $1.58 O $1.60 4 Numerator Denominator If-Converted f-Converted Method Method $60,000 $144,000 What is diluted earnings per share for year 87 20,000 120,000 Per Share Effect $3.00 $1.20
Fortune Cookie Inc. (FCI) issued $10 million of 10-year, 5% convertible bonds on April 1, Year 5 at 102.5 Coupons are payable on April 1 and October 1. Bonds without conversion privileges would have sold at 101.5. FCI’s fiscal year-end is December 31. Please assume that FCI follows IFRS. (1) On October 1, Year 10, 30% of these bonds were converted to common shares right after the payment of interest. Determine the amount to be assigned to common shares at the time of conversion. (2) On December 31, Year 10, additional 30% of these bonds were converted to common shares. Accrued interest was paid at the time of conversion. Determine the amount to be assigned to common shares at the time of conversion.
Carla Vista Corporation had net income of $42,000 for the year ended December 31, 2023, and weighted average number of common shares outstanding of 10,000. The following information is provided regarding the capital structure: 1. 2. (a1) (a2) 8% convertible debt, 210 bonds each convertible into 43 common shares. The bonds were outstanding for the entire year. The income tax rate is 35%. The bonds were issued at par ($1,150 per bond). No bonds were converted during the year. 3% convertible, cumulative $100 preferred shares, 1,000 shares issued and outstanding. Each preferred share is convertible into 2 common shares. The preferred shares were issued at par and were outstanding the entire year. No shares were converted during the year. Calculate the basic earnings per share for 2023. (Round answer to 2 decimal places, e.g. 15.25.) Basic earnings per share eTextbook and Media
Information from the financial statements of Henderson-Niles Industries included the following at December 31, 2016: Common shares outstanding throughout the year 100 million Convertible preferred shares (convertible into 32 million shares of common) 60 million Convertible 10% bonds (convertible into 13.5 million shares of common) $900 million Henderson-Niles’ net income for the year ended December 31, 2016, is $520 million. The income tax rate is 40%. Henderson-Niles paid dividends of $2 per share on its preferred stock during 2016. Required: Compute basic and diluted earnings per share for the year ended December 31, 2016.
Texon Corporation had 8 million shares of common stock outstanding during the current calendar year. On January 1, Texon issued ten thousand $1,000 face value, convertible bonds. Each bond is convertible into 50 shares of common stock. The bonds were issued at face amount and pay interest semiannually for 20 years. They have a stated rate of 12%. Texon had income before tax of $24 million and a net income of $18 million. The income tax rate is 25%. Texon would report the following EPS data (rounded): BASIC EPS Diluted EPS A. $ 2.25 $ 2.24 B. $ 2.25. $ N/A Antidulutive C. $2.25 $ 2.22 D. $2.25. $ 2.25 O Option A O Option B O Option C O Option D SHOW WORK THANKS
Keener Company has had 900 shares of 7%, $100 par preferred stock and 42,000 shares of $5 stated-value common stock outstanding for the last 3 years. During that period, dividends paid totaled $4,800, $28,500, and $31,500 for each year, respectively. Required: Compute the amount of dividends that Keener must have paid to preferred shareholders and common shareholders in each of the 3 years, given the following assumption: If an amount is zero, enter "0". - Preferred stock is fully participating and cumulative.
Information from the financial statements of Henderson-Niles Industries included the following at December 31, 2021: Common shares outstanding throughout the year Convertible preferred shares (convertible into 32 million shares of common) Convertible 8% bonds (convertible into 13.5 million shares of common) 100 million 60 million $ 900 million Henderson-Niles's net income for the year ended December 31, 2021, is $520 million. The income tax rate is 25%. Henderson-Niles paid dividends of $2 per share on its preferred stock during 2021. Required: Compute basic and diluted earnings per share for the year ended December 31, 2021. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Round "Earnings per share" answers to 2 decimal places.) Numerator I Denominator = Earnings per share Basic Diluted
Nolan Corporation has outstanding convertible bonds with a face value of $15,000 and a current book value of $17,500. Each $1,000 bond is convertible into 25 shares of common stock (par value $5 per share). All the bonds are converted into common stock on June 1 when the market value of Nolan’s common stock is $50 per share. Required: Using the book value method, prepare the journal entry for Nolan to record the conversion.
James Company had bonds which are convertible into shares of common stock. There were two bonds, both issued at par. One was for $400,000 and was purchased on January 1st with an interest rate of 6%, this bond is convertible into 200,000 shares of common stock. The second bond was for $600,000 and had an interest rate of 8% and was purchased on May 1st, this bond is convertible into 400,000 shares of common stock. Interest on both bonds is paid annually. The overall tax rate for the organization is 20%. Additionally, net income is $800,000, but does not include interest expense or taxes. The organization currently has 460,000 shares of common stock outstanding. A. Calculate Earnings Per Share B. Calculate Dilutive Earnings Per Share using the if converted method. C. Is the organization anti-dilutive? Explain your answer.
Clear Water Corp. issued $100,000 of 7% 5 year convertible bonds on January 1, 2015. The bonds were issued at 104 and pay interest on June 30 and December 31 of each year. By December 31, 2018, the market price of the stock had increased, and the investors decided to convert the bonds into stock. Each $1,000 bond is convertable into 30 shares of the $2 par value common stock. Determine the balance of the Premium on the bonds and prepare the journal entry to record the conversion of the bonds. (two questions) GENERAL JOURNAL POST Date Account/Description REF. Debit Credit

SEE MORE QUESTIONS

Recommended textbooks for you

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Essentials Of Investments

Finance

ISBN:

9781260013924

Author:

Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:

Mcgraw-hill Education,

FUNDAMENTALS OF CORPORATE FINANCE

Finance

ISBN:

9781260013962

Author:

BREALEY

Publisher:

RENT MCG

Financial Management: Theory & Practice

Finance

ISBN:

9781337909730

Author:

Brigham

Publisher:

Cengage

Foundations Of Finance

Finance

ISBN:

9780134897264

Author:

KEOWN, Arthur J., Martin, John D., PETTY, J. William

Publisher:

Pearson,

Fundamentals of Financial Management (MindTap Cou…

Finance

ISBN:

9781337395250

Author:

Eugene F. Brigham, Joel F. Houston

Publisher:

Cengage Learning

Corporate Finance (The Mcgraw-hill/Irwin Series i…

Finance

ISBN:

9780077861759

Author:

Stephen A. Ross Franco Modigliani Professor of Financial Economics Professor, Randolph W Westerfield Robert R. Dockson Deans Chair in Bus. Admin., Jeffrey Jaffe, Bradford D Jordan Professor

Publisher:

McGraw-Hill Education

SEE MORE TEXTBOOKS