Robertson Company had 40,000 shares of common stock outstanding during 2016 and compensatory shareoptions to purchase 5,000 shares of common stock at $10 a share plus a $3 a share unrecognized compensationcost (net of tax). The average market price is $20 a share. The company also had 7% convertible preferredstock on which dividends of $9,000 were declared. Each preferred share is convertible into 6,000 commonshares. Robertson's after-tax net income was $88,000, and the tax rate was 40%.Required:Compute 2016 diluted earnings per share for Robertson Company.

Earnings per share is the percentage of profits that each share of a company receives.The basic EPS…

Answered: Robertson Company had 40,000 shares of…

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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Mimi Corporation started business in 2007 by issuing 200,000 shares of P20 par common stock for P36 each. In 2012, 30,000 of these shares were purchased for P52 per share by Mimi Corporation and held as treasury stock. On June 15, 2013, these 30,000 shares were exchanged for a piece of property that had an assessed value of P810,000. Mimi's stock is actively traded and had a market price of P60 on June 15, 2013. The cost method is used to account for treasury stock. The amount of paid-in capital from treasury stock transactions resulting from the above events would be:
On January 1, 2018, Tonge Industries had outstanding 800,000 common shares ($1 par) that originally sold for $20 per share, and 3,000 shares of 10% cumulative preferred stock ($100 par), convertible into 30,000 common shares. On October 1, 2018, Tonge sold and issued an additional 20,000 shares of common stock at $36. At December 31, 2018, there were 28,000 incentive stock options outstanding, issued in 2017, and exercisable after one year for 28,000 shares of common stock at an exercise price of $30. The market price of the common stock at year-end was $48. During the year, the price of the common shares had averaged $40. Net income was $940,000. The tax rate for the year was 40%. Required: Compute basic and diluted EPS for the year ended December 31, 2018. (Enter your answers in thousands.) Basic Diluted Numerator 1 1 1 Denominator = Earnings per share =
On January 1, 2018, Tonge Industries had outstanding 700,000 common shares ($1 par) that originally sold for $25 per share, and 5,000 shares of 10% cumulative preferred stock ($100 par), convertible into 50,000 common shares. On October 1, 2018, Tonge sold and issued an additional 12,000 shares of common stock at $37. At December 31, 2018, there were 22,000 incentive stock options outstanding, issued in 2017, and exercisable after one year for 22,000 shares of common stock at an exercise price of $34. The market price of the common stock at year-end was $52. During the year, the price of the common shares had averaged $44. Net income was $840,000. The tax rate for the year was 40%. Required: Compute basic and diluted EPS for the year ended December 31, 2018. (Enter your answers in thousands.) Basic Diluted $ $ Numerator Answer is complete but not entirely correct. 790,000/ 840,000 X Denominator 703,000 754,784 - S $ Earnings per share 1.12 1.11
Crane Co. had 190000 shares of common stock, 20700 shares of convertible preferred stock, and $1540000 of 4% convertible bonds outstanding during 2025. The preferred stock is convertible into 40400 shares of common stock. During 2025, Crane paid dividends of $1.00 per share on the common stock and $3 per share on the preferred stock. Each $1000 bond is convertible into 30 shares of common stock. Crane's net income for 2025 was $605000 and its income tax rate was 35%. Diluted earnings per share for 2025 was O $2.33. # O $2.19. O $2.15. O $2.63.
In January 2014, ABC Corporation, a new corporation, issued 10,000 shares of common stock with a par value of $10 for $15 per share. On July 1, 2014, ABC Corporation repurchased 1,000 shares of stock that were outstanding for $12 per share. This repurchase transaction has the effect of: a. it does not affect the total shareholders' equity. b. reduce the total equity of the shareholders. c. decrease the number of shares issued.
On December 31, 2020, Brisbane Company had 100,000 shares of common stock outstanding and 30,000 shares of 7%, $50 par, cumulative preferred stock outstanding. On February 28, 2021, Brisbane purchased 24,000 shares of common stock on the open market as treasury stock paying $40 per share. Brisbane sold 6,000 treasury shares on September 30, 2021, for $45 per share. Net income for 2021 was $180,905. Also outstanding during the year were fully vested incentive stock options giving key officers the option to buy 50,000 common shares at $40. The market price of the common shares averaged $50 during 2021. Compute Brisbane's basic and diluted earnings per share (rounded to 2 decimal places) for 2021.
Blue Cab Company had 50,000 shares of common stock outstanding on January 1, 2018. On April 1, 2018, the company issued 20,000 shares of common stock. The company had outstanding fully vested incentive stock options for 5,000 shares exercisable at $10 that had not been exercised by its executives. The end-of-year market price of common stock was $13 while the average price for the year was $12. The company reported net income in the amount of $269,915 for 2018. What is the diluted earnings per share (rounded)?
Relenta Company reported an after-tax net profit of Rs. 3,17,000 for 2022. On April 1, 2021 the company had 96000 equity shares of Rs.10 par value and 1000 of 12%, Rs.100 convertible cumulative preference shares. Information about transactions that affected the share capital are as follows: 1. On July 1, 2021, Company declared bonus of 1 share for every 4 shares held. 2. Issued 60,000 shares at a premium of Rs.25 on October 1, 2021 On March 31, 2022, company declared preference dividends of Rs.12000. Required: 1. Analyze the basic Earning per share (EPS) for 2022. 2. Compute the diluted earning per share (EPS) assuming each preference share will be converted into 10 equity shares. 3. Comment upon the difference between the two.
Colson Corp. had $750,000 net income in 2015. On January 1, 2015 there were 200,000 shares of common stock outstanding. On April 1, 23,000 shares were issued and on September 1, Colson bought 29,400 shares of treasury stock. On Oct 1, Colson declared a 10% Stock Dividend. As of Jan 1st, there are 28,000 stock options outstanding. The Option Exercise price was $40 per share and the market price of the common stock averaged $50 during 2015. The tax rate is 40%. During 2015, there were 40,000 shares of convertible preferred stock outstanding. The preferred is $100 par, pays $3.50 a year dividend, and is convertible into three shares of common stock. Colson issued $2,000,000 of 8% convertible bonds at face value during 2014. Each $1,000 bond is convertible into 30 shares of common stock. Instructions Compute Basic and Diluted earnings per share for 2015 in Good form, show all computations.
BMS Ltd. had 2,200,000 average shares outstanding during all of 2017. During 2017, BMS also had 50,000 options outstanding with exercise prices of $17 each. The average stock price of BMS during 2017 was $21. This company also had 1,000 shares of preferred stock outstanding (10%. $100 par value) for the entire year, which are each convertible into 20 shares of common stock. If net income of the company was 500,000, what is the diluted earnings per share for 2017? A. $0.224 B. $0.220 C. $0.226 D. $0.225
7. At December 31, 2024, DEF Corporation had outstanding 200,000 shares of common stock. Also outstanding were 80,000 shares of preferred stock convertible into 64,000 common shares and $2,000,000 of 10% bonds convertible into 30,000 common shares. DEF's net income for the year ended December 31, 2024, is $1,140,000. The income tax rate is 25%. DEF paid dividends of $3 per share on its preferred stack during 2024. Required: Compute basic and diluted earnings per share for the year ended December 31, 2024, considering possible antidilutive effects.
BARK Corporation acquired 10,000 Company shares on February 5, 2016 at P50 which include P10 per share broker's fees and commissions, A P50,000 cash dividends were received from MEOW Company on March 20, 2016. These dividends were declared on January 5 payable to shareholders as of February 10. MEOW Company shares were split 2 for 1 on November 1. The shares were selling at P32 per share on December 31, 2016. The investments were designated as FVPL. How much should be recognized as dividend income?

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