It is December 20X1. On May 1, 20X1, the 10% debentures with a principal amount of $400,000 were converted into 12,000 shares. What adjustments are required to the numerator and denominator in calculating the dilutive effect on the EPS if the company pays taxes at 30 % ? Multiple Choice On numerator add back interest of $9,333 and denominator add 4,000 shares. On numerator add back interest of $40,000 and denominator add 12,000 shares. On numerator add back interest of $28,000 and denominator add 6,000 shares On numerator add back interest of S 13, 333 and denominator add 12,000 shares Please provide an explanation of the correct answer

It is December 20X1. On May 1, 20X1, the 10% debentures with a principal amount of $400,000 were converted into 12,000 shares. What adjustments are required to the numerator and denominator in calculating the dilutive effect on the EPS if the company pays taxes at 30 % ? Multiple Choice On numerator add back interest of $9,333 and denominator add 4,000 shares. On numerator add back interest of $40,000 and denominator add 12,000 shares. On numerator add back interest of $28,000 and denominator add 6,000 shares On numerator add back interest of S 13, 333 and denominator add 12,000 shares Please provide an explanation of the correct answer

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter14: Corporation Accounting

Section: Chapter Questions

Problem 20EA: Longmont Corporation earned net income of $90,000 this year. The company began the year with 600...

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Longmont Corporation earned net income of $90,000 this year. The company began the year with 600 shares of common stock and issued 500 more on April 1. They issued $5,000 in preferred dividends for the year. What is the numerator of the EPS calculation for Longmont?
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