Plug Corporation holds 80 percent of Socket Company’s common stock. The following balance sheet data are presented for December 31, 20X7:

Socket reported net income of $115,000 in 20X7 and paid dividends of $60,000. Its bonds have an annual interest rate of 8 percent and are convertible into 30,000 common shares. Its preferred shares pay an 11 percent annual dividend and convert into 20,000 shares of common stock. In addition, Socket has warrants outstanding for 10,000 shares of common stock at $8 per share. The 20X7 average price of Socket common shares was $40.
Plug reported income of $300,000 from its own operations for 20X7 and paid dividends of $200,000. Its 10 percent bonds convert into 25,000 shares of its common stock. The companies file separate tax returns and are subject to income taxes of 40 percent.

Required 

Compute basic and diluted EPS for the consolidated entity for 20X7.

Transcribed Image Text:

Cash Accounts Receivable Inventory Plug Corporation $ 100,000 150,000 300,000 Socket Company $ 90,000 220,000 300,000