I need help with an Earning Per Share problem . attached please find details . please show all workAt January 1, 2013 xyz corporation had outstanding the following securities:
$ 1,000,000, 5% cumulative convertible preferred shares, $50 par; each share is convertible into
2 shares of common stock
7% convertible bonds, $2,000,000 face value issued at par ($1,000) per bond. Each bond is
convertible into 30 shares of common stock
$ 6,000,000 common stock, $ 10 par value
Additional information:
1.
On April 1, 2013 xyz purchased 100,000 shares of its common stock treasury stock.
2.
06/30/13 , xyz issued 4% stock dividend
3.
On 10/31/13, 50,000 shares of treasury stock were sold
4.
Common stock options outstanding as of 12/31/12 and exercisable in 2013 to purchase
40,000 shares at an exercise price of $30
5.
The market price of the stock peaked on 10/31/13 at $50 and on 12/31/13 the market
price of the stock closed at $30; the average market price of stock during 2013 was $40
6.
Net income for the year ended 12/31/13 was 1,500,000.
7.
The income tax rate for 2013 was 40%
Required:
Calculate basic and diluted EPS
This question was answered on: May 23, 2022
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