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Computing Diluted EPS: Convertible Bonds and Convertible Preferred Stock Jones Corporation's capital structure follows. December 31 2020   Outstanding shares of stock     Common stock, outstanding shares 154,000   Convertible preferred stock, outstanding shares 14,000   8% Convertible bonds $1,400,000     During 2020, Jones declared and paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible in 28,000 shares of common stock. The 8% bonds are convertible into 42,000 shares of common stock. Net income for 2020 is $1,360,000. Assume that the income tax rate is 25%. Required a. Compute basic EPS for 2020. b. Compute diluted EPS for 2020. Note: Round earnings per share amounts to two decimal places.   Net Income Available to Common Stockholders Weighted Avg. Common Shares Outstanding Per Share Basic EPS Answer Answer Answer Diluted EPS Answer Answer Answer

Computing Diluted EPS: Convertible Bonds and Convertible Preferred Stock Jones Corporation's capital structure follows. December 31 2020   Outstanding shares of stock     Common stock, outstanding shares 154,000   Convertible preferred stock, outstanding shares 14,000   8% Convertible bonds $1,400,000     During 2020, Jones declared and paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible in 28,000 shares of common stock. The 8% bonds are convertible into 42,000 shares of common stock. Net income for 2020 is $1,360,000. Assume that the income tax rate is 25%. Required a. Compute basic EPS for 2020. b. Compute diluted EPS for 2020. Note: Round earnings per share amounts to two decimal places.   Net Income Available to Common Stockholders Weighted Avg. Common Shares Outstanding Per Share Basic EPS Answer Answer Answer Diluted EPS Answer Answer Answer

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 11P: Raun Company had the following equity items as of December 31, 2019: Preferred stock, 9% cumulative,...
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Computing Diluted EPS: Convertible Bonds and Convertible Preferred Stock

Jones Corporation's capital structure follows.

December 31 2020  
Outstanding shares of stock    
Common stock, outstanding shares 154,000  
Convertible preferred stock, outstanding shares 14,000  
8% Convertible bonds $1,400,000  

 

During 2020, Jones declared and paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible in 28,000 shares of common stock. The 8% bonds are convertible into 42,000 shares of common stock. Net income for 2020 is $1,360,000. Assume that the income tax rate is 25%.

Required

a. Compute basic EPS for 2020.

b. Compute diluted EPS for 2020.

  • Note: Round earnings per share amounts to two decimal places.
  Net Income Available to
Common Stockholders		 Weighted Avg. Common
Shares Outstanding		 Per
Share
Basic EPS Answer Answer Answer
Diluted EPS Answer Answer Answer
 
 
Computing Diluted EPS: Convertible Bonds and Convertible Preferred Stock Jones Corporation's capital structure follows. December 31 2020 Outstanding shares of stock Common stock, outstanding shares 154,000 Convertible preferred stock, outstanding shares 14,000 8% Convertible bonds $1,400,000 During 2020, Jones declared and paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible in 28,000 shares of common stock. The 8% bonds are convertible into 42,000 shares of common stock. Net income for 2020 is $1,360,000. Assume that the income tax rate is 25%. Required a. Compute basic EPS for 2020. b. Compute diluted EPS for 2020. Note: Round earnings per share amounts to two decimal places. Net Income Available to Weighted Avg. Common Shares Outstanding Per Common Stockholders Share Basic EPS 2$ O $ Diluted EPS $ 0 $
Transcribed Image Text:Computing Diluted EPS: Convertible Bonds and Convertible Preferred Stock Jones Corporation's capital structure follows. December 31 2020 Outstanding shares of stock Common stock, outstanding shares 154,000 Convertible preferred stock, outstanding shares 14,000 8% Convertible bonds $1,400,000 During 2020, Jones declared and paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible in 28,000 shares of common stock. The 8% bonds are convertible into 42,000 shares of common stock. Net income for 2020 is $1,360,000. Assume that the income tax rate is 25%. Required a. Compute basic EPS for 2020. b. Compute diluted EPS for 2020. Note: Round earnings per share amounts to two decimal places. Net Income Available to Weighted Avg. Common Shares Outstanding Per Common Stockholders Share Basic EPS 2$ O $ Diluted EPS $ 0 $
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