Online Network Inc. has a net income of $570,000 in the current fiscal year. There are 100,000 shares of common stock ou along with convertible bonds, which have a total face value of $1.4 million. The $1.4 million is represented by 1,400 different $1,000 bonds. Each $1,000 bond pays 6 percent interest. The conversion ratio is 30. The firm is in a 40 percent tax bracket. a. Compute basic earnings per share. (Do not round intermediate calculations and round your answer to 2 decimal places.) Basic earnings per share b. Compute diluted earnings per share. (Do not round intermediate calculations and round your answer to 2 decimal places.) Diluted earnings per share

Online Network Inc. has a net income of $570,000 in the current fiscal year. There are 100,000 shares of common stock ou along with convertible bonds, which have a total face value of $1.4 million. The $1.4 million is represented by 1,400 different $1,000 bonds. Each $1,000 bond pays 6 percent interest. The conversion ratio is 30. The firm is in a 40 percent tax bracket. a. Compute basic earnings per share. (Do not round intermediate calculations and round your answer to 2 decimal places.) Basic earnings per share b. Compute diluted earnings per share. (Do not round intermediate calculations and round your answer to 2 decimal places.) Diluted earnings per share

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter9: The Cost Of Capital

Section: Chapter Questions

Problem 7P

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