Loose Leaf for Foundations of Financial Management Format: Loose-leaf
17th Edition
ISBN: 9781260464924
Author: BLOCK
Publisher: Mcgraw Hill Publishers
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Question
Chapter 19, Problem 20P
a.
Summary Introduction
To calculate: The basic EPS of Online Network Inc.
Introduction:
Basic Earnings Per Share (Basic EPS):
It is that part of the profits of a company which is to be distributed to each outstanding share of a company’s common stock in a particular period.
b.
Summary Introduction
To calculate: The diluted EPS of Online Network Inc.
Introduction:
Diluted Earnings Per Share (Diluted EPS):
It is computed after taking into account all the convertible securities, such as stock options, convertible debentures or
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Students have asked these similar questions
Online Network Inc. has a net income of $700,000 in the current fiscal year. There are 100,000 shares of common stock outstanding,
along with convertible bonds, which have a total face value of $1.5 million. The $1.5 million is represented by 1,500 different $1,000
bonds. Each $1,000 bond pays 6 percent interest. The conversion ratio is 10. The firm is in a 20 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
C
b. Compute diluted earnings per share. (Do not round intermediate calculations and round your answer to 2 decimal places.)
200
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 outstanding,
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 eamings 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
Vickrey Technology has had net income of $1,500,000 in the current fiscal year. There are 1,000,000 shares of common stock outstanding along with convertible bonds, which have a total face value of $8 million. The $8 million is represented by 5,000 different $1,000 bonds. Each $1,000 bond owes and pays 4% interest. The conversion ratio is 30. The firm is in a 21% tax bracket. What is Vickrey's "diluted earnings per share?"
A. $1.44
B. $1.81
C. $2.00
D. $1.30
Chapter 19 Solutions
Loose Leaf for Foundations of Financial Management Format: Loose-leaf
Ch. 19 - Prob. 1DQCh. 19 - Prob. 2DQCh. 19 - Why is it said that convertible securities have a...Ch. 19 - Prob. 4DQCh. 19 - Prob. 5DQCh. 19 - Prob. 6DQCh. 19 - Explain the difference between basic earnings per...Ch. 19 - Prob. 8DQCh. 19 - Prob. 9DQCh. 19 - Prob. 10DQ
Ch. 19 - Prob. 11DQCh. 19 - Prob. 12DQCh. 19 - Prob. 13DQCh. 19 - Prob. 1PCh. 19 - Prob. 2PCh. 19 - Prob. 3PCh. 19 - Prob. 4PCh. 19 - Prob. 5PCh. 19 - Prob. 6PCh. 19 - Prob. 7PCh. 19 - Prob. 8PCh. 19 - Prob. 9PCh. 19 - Prob. 10PCh. 19 - Prob. 11PCh. 19 - Prob. 12PCh. 19 - Prob. 13PCh. 19 - Prob. 14PCh. 19 - Prob. 15PCh. 19 - Prob. 16PCh. 19 - Prob. 17PCh. 19 - Prob. 18PCh. 19 - Prob. 19PCh. 19 - Prob. 20PCh. 19 - Prob. 21PCh. 19 - Prob. 22PCh. 19 - Prob. 23PCh. 19 - What area the first five products offered?
Ch. 19 - Prob. 4WE
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