On December 31, 2023, Berclair Incorporated had 600 million shares of common stock and 17 million shares of 9%, $100 par value cumulative preferred stock issued and outstanding. • . On March 1, 2024, Berclair purchased 120 million shares of its common stock as treasury stock. Berclair issued a 6% common stock dividend on July 1, 2024. • Four million treasury shares were sold on October 1. • Net income for the year ended December 31, 2024, was $850 million. Also outstanding at December 31 were 72 million incentive stock options granted to key executives on September 13, 2019. The options were exercisable as of September 13, 2023, for 72 million common shares at an exercise price of $60 per share. During 2024, the market price of the common shares averaged $90 per share. The options were exercised on September 1, 2024. Required: Compute Berclair's basic and diluted earnings per share for the year ended December 31, 2024. (Shares for stock options and conversion of convertible securities have been adjusted for any stock split or stock dividend.) Note: Do not round intermediate calculations. Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Answer is complete but not entirely correct. Numerator Basic $ 697 Diluted $ 697 Denominator Earnings per Share 531 X = $ 1.31 555 X = $ 1.26
On December 31, 2023, Berclair Incorporated had 600 million shares of common stock and 17 million shares of 9%, $100 par value cumulative preferred stock issued and outstanding. • . On March 1, 2024, Berclair purchased 120 million shares of its common stock as treasury stock. Berclair issued a 6% common stock dividend on July 1, 2024. • Four million treasury shares were sold on October 1. • Net income for the year ended December 31, 2024, was $850 million. Also outstanding at December 31 were 72 million incentive stock options granted to key executives on September 13, 2019. The options were exercisable as of September 13, 2023, for 72 million common shares at an exercise price of $60 per share. During 2024, the market price of the common shares averaged $90 per share. The options were exercised on September 1, 2024. Required: Compute Berclair's basic and diluted earnings per share for the year ended December 31, 2024. (Shares for stock options and conversion of convertible securities have been adjusted for any stock split or stock dividend.) Note: Do not round intermediate calculations. Enter your answers in millions (i.e., 10,000,000 should be entered as 10). Answer is complete but not entirely correct. Numerator Basic $ 697 Diluted $ 697 Denominator Earnings per Share 531 X = $ 1.31 555 X = $ 1.26
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 10MC
Related questions
Question
Transcribed Image Text:On December 31, 2023, Berclair Incorporated had 600 million shares of common stock and 17 million shares of 9%, $100 par value
cumulative preferred stock issued and outstanding.
•
.
On March 1, 2024, Berclair purchased 120 million shares of its common stock as treasury stock.
Berclair issued a 6% common stock dividend on July 1, 2024.
• Four million treasury shares were sold on October 1.
• Net income for the year ended December 31, 2024, was $850 million.
Also outstanding at December 31 were 72 million incentive stock options granted to key executives on September 13, 2019.
The options were exercisable as of September 13, 2023, for 72 million common shares at an exercise price of $60 per share.
During 2024, the market price of the common shares averaged $90 per share.
The options were exercised on September 1, 2024.
Required:
Compute Berclair's basic and diluted earnings per share for the year ended December 31, 2024. (Shares for stock options and
conversion of convertible securities have been adjusted for any stock split or stock dividend.)
Note: Do not round intermediate calculations. Enter your answers in millions (i.e., 10,000,000 should be entered as 10).
Answer is complete but not entirely correct.
Numerator
Basic
$
697
Diluted
$
697
Denominator
Earnings per Share
531 X =
$
1.31
555 X
=
$
1.26
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