Ehrlich Corporation has 400,000 shares of common stock outstanding throughout 2021. In addition, the corporation has 5,000, 20-year, 9% bonds issued at par in 2019. Each $1,000 bond is convertible into 20 shares of common stock after 9/23/22. During the year 2021, the corporation earned $900,000 of net income. The tax rate was 25%.   Ehrlich Corporation has 400,000 shares of common stock outstanding throughout 2021. In addition, the corporation has warrants exercisable at $20 each to obtain 80,000 shares of common stock when

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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  1. Ehrlich Corporation has 400,000 shares of common stock outstanding throughout 2021. In addition, the corporation has 5,000, 20-year, 9% bonds issued at par in 2019. Each $1,000 bond is convertible into 20 shares of common stock after 9/23/22. During the year 2021, the corporation earned $900,000 of net income. The tax rate was 25%.

 

  1. Ehrlich Corporation has 400,000 shares of common stock outstanding throughout 2021. In addition, the corporation has warrants exercisable at $20 each to obtain 80,000 shares of common stock when the average market price of the common stock was $25.. During the year 2021, the corporation earned $900,000 of net income.

 

 

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Compute the basic earnings per share for 2021, and the diluted earnings per share under each of the above situations (note-BEPS is the same for both a and b).

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