Poppy Corporation owns 60 percent of Seed Company's common shares. Balance sheet data for the companies on December 31, 20X2, are as follows: Poppy Corporation Assets Cash Accounts Receivable Inventory Buildings and Equipment Less: Accumulated Depreciation Investment in Seed Company Stock Total Assets Llabilities and Owners' Equity Accounts Payable $ 90,000 88,000 112,000 670,000 (205,000) 132,000 $ 887,000 $ 107,000 250,000 300,000 230,000 Seed Company $ 39,000 54,000 100,000 97,000 (71,000) $ 519,000 $ 99,000 200,000 100,000 120,000 $ 519,000 Bonds Payable Common Stock ($10 par value) Retained Earnings Total Liabilities and Owners' Equity $ 887,000 The bonds of Poppy Corporation and Seed Company pay annual interest of 8 percent and 10 percent, respectively. Poppy's bonds are not convertible. Seed's bonds can be converted into 10,000 shares of its company stock any time after January 1, 20X1. An income tax rate of 40 percent is applicable to both companies. Seed reports net income of $32,000 for 20X2 and pays dividends of $13,000. Poppy reports income from its separate operations of $54,000 and pays dividends of $24,000. Required: Compute basic and diluted EPS for the consolidated entity for 20x2 Note: Round your answers to 2 decimal places.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Poppy Corporation owns 60 percent of Seed Company's common shares. Balance sheet
data for the companies on December 31, 20X2, are as follows:
Poppy Corporation
Assets
Cash
Accounts Receivable
Inventory
Buildings and Equipment
Less: Accumulated Depreciation
Investment in Seed Company Stock
Total Assets
Llabilities and Owners' Equity
Accounts Payable
Bonds Payable
Common Stock ($10 par value)
$ 90,000
88,000
112,000
670,000
(205,000)
132,000
$ 887,000
Retained Earnings
Total Llabilitles and Owners' Equity
$ 107,000
250,000
300,000
230,000
Seed Company
$ 39,000
54,000
100,000
97,000
(71,000)
$ 99,000
200,000
100,000
120,000
$ 887,000
$ 519,000
The bonds of Poppy Corporation and Seed Company pay annual interest of 8 percent
and 10 percent, respectively. Poppy's bonds are not convertible. Seed's bonds can be
converted into 10,000 shares of its company stock any time after January 1, 20X1. An
income tax rate of 40 percent is applicable to both companies. Seed reports net income
of $32,000 for 20X2 and pays dividends of $13,000. Poppy reports income from its
separate operations of $54,000 and pays dividends of $24,000.
$ 519,000
Required:
Compute basic and diluted EPS for the consolidated entity for 20X2
Note: Round your answers to 2 decimal places.
Transcribed Image Text:Poppy Corporation owns 60 percent of Seed Company's common shares. Balance sheet data for the companies on December 31, 20X2, are as follows: Poppy Corporation Assets Cash Accounts Receivable Inventory Buildings and Equipment Less: Accumulated Depreciation Investment in Seed Company Stock Total Assets Llabilities and Owners' Equity Accounts Payable Bonds Payable Common Stock ($10 par value) $ 90,000 88,000 112,000 670,000 (205,000) 132,000 $ 887,000 Retained Earnings Total Llabilitles and Owners' Equity $ 107,000 250,000 300,000 230,000 Seed Company $ 39,000 54,000 100,000 97,000 (71,000) $ 99,000 200,000 100,000 120,000 $ 887,000 $ 519,000 The bonds of Poppy Corporation and Seed Company pay annual interest of 8 percent and 10 percent, respectively. Poppy's bonds are not convertible. Seed's bonds can be converted into 10,000 shares of its company stock any time after January 1, 20X1. An income tax rate of 40 percent is applicable to both companies. Seed reports net income of $32,000 for 20X2 and pays dividends of $13,000. Poppy reports income from its separate operations of $54,000 and pays dividends of $24,000. $ 519,000 Required: Compute basic and diluted EPS for the consolidated entity for 20X2 Note: Round your answers to 2 decimal places.
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