ermin company had 200,000 ordinary shares outstanding on January 1. In addition, as of January 1, the company had issued 4,000 convertible 10% bonds with 1,000 face value. The company has no other potentially dilutive securities. The bonds were converted on October 1 and 40 ordinary shares were issued in exchange for each bond. Accrued interest on the bonds was recognized and paid on that date. Net income for the year was 5,000,000. The income tax rate is 30%. a. What is the amount of basic earnings per share?
ermin company had 200,000 ordinary shares outstanding on January 1. In addition, as of January 1, the company had issued 4,000 convertible 10% bonds with 1,000 face value. The company has no other potentially dilutive securities. The bonds were converted on October 1 and 40 ordinary shares were issued in exchange for each bond. Accrued interest on the bonds was recognized and paid on that date. Net income for the year was 5,000,000. The income tax rate is 30%. a. What is the amount of basic earnings per share?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Fermin company had 200,000 ordinary shares outstanding on January 1. In addition, as of January 1, the company had issued 4,000 convertible 10% bonds with 1,000 face value. The company has no other potentially dilutive securities. The bonds were converted on October 1 and 40 ordinary shares were issued in exchange for each bond. Accrued interest on the bonds was recognized and paid on that date. Net income for the year was 5,000,000. The income tax rate is 30%.
a. What is the amount of basic earnings per share?
b. What is the amount of diluted earnings per share?
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