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When calculating the diluted EPS in 2020, what conversion factor should they use?

When calculating the diluted EPS in 2020, what conversion factor should they use?

FINANCIAL ACCOUNTING
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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16.5 Diluted Earnings per Share In 2017, Crandall Organic Produce issued $1,000 par value, 8% convertible bonds with a 10-year term with the following stipulations: 1. Convertible for 10 shares of $10 par value common stock if exercised between January 1, 2017, and December 31, 2018. 2. Convertible for 15 shares of $10 par value common stock if exercised between January 1, 2019, and December 31, 2021. 3. Convertible for 25 shares of $10 par value common stock if exercised between January 1, 2022, and December 31, 2024. 4. Convertible for 40 shares of $10 par value common stock if exercised between January 1, 2025, and December 31, 2026. When calculating the diluted EPS in 2020, what conversion factor should they use? 10 shares per bond 40 shares per bond 15 shares per bond. 25 shares per bond Save for Later Submit Answer
Transcribed Image Text:16.5 Diluted Earnings per Share In 2017, Crandall Organic Produce issued $1,000 par value, 8% convertible bonds with a 10-year term with the following stipulations: 1. Convertible for 10 shares of $10 par value common stock if exercised between January 1, 2017, and December 31, 2018. 2. Convertible for 15 shares of $10 par value common stock if exercised between January 1, 2019, and December 31, 2021. 3. Convertible for 25 shares of $10 par value common stock if exercised between January 1, 2022, and December 31, 2024. 4. Convertible for 40 shares of $10 par value common stock if exercised between January 1, 2025, and December 31, 2026. When calculating the diluted EPS in 2020, what conversion factor should they use? 10 shares per bond 40 shares per bond 15 shares per bond. 25 shares per bond Save for Later Submit Answer
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