A company earned net income of $15,000 in 2020 and had 4,200 shares of common stock...

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A company earned net income of $15,000 in 2020 and had 4,200 shares of common stock outstanding on January 1, 2020. The tax rate is 20% and the common stock sold at an average market price of $18 per share during the period. The company had the following transactions affecting common shares outstanding during the year: • Sold 2,000 shares of common stock on March 1, 2020 • Repurchased 500 shares of common stock on June 1, 2020 Had a 2 for 1 stock split on August 1, 2020 Issued 2,600 shares of common stock on October 1, 2020 The company also had the following items outstanding: • 3,000 stock options that could be exercised to purchase one share of common stock for $9 for each option exercised. $100,000 of 6% bonds; convertible into 10,000 common shares • 1,000 shares outstanding of $50 par 4% cumulative, convertible preferred stock, which are convertible into 5,000 shares of common stock The company had no dividends in arrears and had not declared a dividend for 2020. Compute the company's 2020 basic and diluted earnings per share. Round to 2 decimal places. (type out as much of your work as you can so that I can give you partial credit) A company earned net income of $15,000 in 2020 and had 4,200 shares of common stock outstanding on January 1, 2020. The tax rate is 20% and the common stock sold at an average market price of $18 per share during the period. The company had the following transactions affecting common shares outstanding during the year: • Sold 2,000 shares of common stock on March 1, 2020 • Repurchased 500 shares of common stock on June 1, 2020 Had a 2 for 1 stock split on August 1, 2020 Issued 2,600 shares of common stock on October 1, 2020 The company also had the following items outstanding: • 3,000 stock options that could be exercised to purchase one share of common stock for $9 for each option exercised. $100,000 of 6% bonds; convertible into 10,000 common shares • 1,000 shares outstanding of $50 par 4% cumulative, convertible preferred stock, which are convertible into 5,000 shares of common stock The company had no dividends in arrears and had not declared a dividend for 2020. Compute the company's 2020 basic and diluted earnings per share. Round to 2 decimal places. (type out as much of your work as you can so that I can give you partial credit)

Answer rating: 100% (QA)

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