Pharoah Corporation had net income of $54,500 for the year ended December 31, 2020, and a...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Pharoah Corporation had net income of $54,500 for the year ended December 31, 2020, and a weighted average number of common shares outstanding of 13,400. The following information is provided regarding the capital structure: 8% convertible debt, 230 bonds each convertible into 43 common shares. The bonds were outstanding for the entire year. The income tax rate is 35%. The bonds were issued at par ($1,000 per bond). No bonds were converted during the 1. year. 3% convertible, cumulative $110 preferred shares, 1,100 shares issued and outstanding. Each preferred share is convertible into 2 common shares. The preferred shares were issued at par and were outstanding the entire year. No shares were converted during the year. 2. Your answer is incorrect. Calculate the income effect of the dividends on preferred shares. Dividends on preferred shares $ eTextbook and Media X Your answer is incorrect. Calculate the basic earnings per share for 2020. (Round answer to 2 decimal places, e.g. 15.25.) Basic earnings per share 2$ Calculate the after-tax interest paid on the 8% bonds. After-tax interest on bonds converted $ Determine an incremental per share effect for 8% bonds. (Round earnings per share to 2 decimal places, e.g. 15.25.) Potentially dilutive security Incremental Incremental Numerator Effect Denominator Effect EPS 8% Bonds $ $ Determine an incremental per share effect for 3% preferred shares. (Round earnings per share to 2 decimal places, e.g. 15.25.) Potentially dilutive security Incremental Incremental Numerator Effect Denominator Effect EPS 3% Preferred shares %24 Calculate the diluted earnings per share for 2020, using the if-converted method. For simplicity, ignore the requirement to record the debt and equity components of the bonds separately. (Round earnings per share to 2 decimal places, e.g. 15.25.) Numerator Denominator EPS Basic $ Sub Total $ $ Diluted EPS %24 %24 Pharoah Corporation had net income of $54,500 for the year ended December 31, 2020, and a weighted average number of common shares outstanding of 13,400. The following information is provided regarding the capital structure: 8% convertible debt, 230 bonds each convertible into 43 common shares. The bonds were outstanding for the entire year. The income tax rate is 35%. The bonds were issued at par ($1,000 per bond). No bonds were converted during the 1. year. 3% convertible, cumulative $110 preferred shares, 1,100 shares issued and outstanding. Each preferred share is convertible into 2 common shares. The preferred shares were issued at par and were outstanding the entire year. No shares were converted during the year. 2. Your answer is incorrect. Calculate the income effect of the dividends on preferred shares. Dividends on preferred shares $ eTextbook and Media X Your answer is incorrect. Calculate the basic earnings per share for 2020. (Round answer to 2 decimal places, e.g. 15.25.) Basic earnings per share 2$ Calculate the after-tax interest paid on the 8% bonds. After-tax interest on bonds converted $ Determine an incremental per share effect for 8% bonds. (Round earnings per share to 2 decimal places, e.g. 15.25.) Potentially dilutive security Incremental Incremental Numerator Effect Denominator Effect EPS 8% Bonds $ $ Determine an incremental per share effect for 3% preferred shares. (Round earnings per share to 2 decimal places, e.g. 15.25.) Potentially dilutive security Incremental Incremental Numerator Effect Denominator Effect EPS 3% Preferred shares %24 Calculate the diluted earnings per share for 2020, using the if-converted method. For simplicity, ignore the requirement to record the debt and equity components of the bonds separately. (Round earnings per share to 2 decimal places, e.g. 15.25.) Numerator Denominator EPS Basic $ Sub Total $ $ Diluted EPS %24 %24
Expert Answer:
Answer rating: 100% (QA)
Dividends on preferred shares 3 x 110 x 1100 3630 Basic earnings per shar... View the full answer
Related Book For
Managerial Accounting Tools for Business Decision Making
ISBN: 9781119403999
5th Canadian edition
Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso, Ibrahim M. Aly
Posted Date:
Students also viewed these accounting questions
-
The income statement for Delta-tec Inc. for the year ended December 31, 2016, was as follows: Delta-tec Inc. Income Statement (selected items) For the Year Ended December 31, 2016 1 Income from...
-
The following income statement and balance sheets for Virtual Gaming Systems are provided. Earnings per share for the year ended December 31, 2021, are $1.30. The closing stock price on December 31,...
-
The income statement for the year ended December 31, 2007, for Mayr Melnhof Karton, an Austrian paper and packaging manufacturer, appears in Exhibit 1.11 Mayr Melnhof reports all amounts in thousands...
-
Compare and contrast megaloblastic anemia caused by vitamin B12 deficiency and that caused by folic acid deficiency. (10)
-
Consider the reducing agents Cu + (aq), Zn(s), and Fe(s). Which is strongest? Which is weakest?
-
If the magnitude of the vector product of two vectors is the same as the magnitude of the scalar product of the same two vectors, what is the angle between them?
-
What is the unit of refrigeration?
-
At December 31, 2017, the following information was available for E. Hetzel Company: ending inventory $40,000, beginning inventory $56,000, cost of goods sold $270,000 and sales revenue $380,000....
-
What is the importance of employee-driven content? To appeal to adult learners, what do delivery methods need to include, and why?
-
During 2020, Richard and Greta Van Fleet, who are married and have two dependent children, ages 14 and 16, and have the following information: Total salaries Bank account interest State of Idaho bond...
-
Explain how to overcome the problem of empty communities, silent communities and critical communities.
-
Produce an outline list of the main activities that need to occur for e-CRM implementation and maintenance.
-
How, when and why should profiling occur for an organization you are familiar with.
-
Explain the relevance of the prosumer concept to the modern marketer.
-
How would you assess whether a web site had good customer orientation?
-
Using the information below -- what was Bala Industries' Cash Flow from Financing for the year ending 6/30/2011? Round to the nearest cent. Increase in inventories $31 Purchased treasury stock $18...
-
Under what conditions is the following SQL statement valid?
-
On January 1, 2021, the Chinlee Company budget committee reached agreement on the following data for the six months ending June 30, 2021: Prepare production and direct materials budgets by quarters...
-
For the year ending December 31, 2020, Sanjay Company accumulates the following data for the plastics division, which it operates as an investment centre: contribution margin $700,000 budgeted,...
-
The U.S. Institute of Management Accountants has developed ethical standards for managerial accountants. Explain the importance of business ethics. Instructions Identify the four specific standards.
-
Nestls financial statements are presented in Appendix B. Financial statements of Delfi Limited are presented in Appendix C. Instructions Refer to the financial statements and answer the following...
-
Writing Financial statement information about four different companies is as follows. Instructions a. Determine the missing amounts. (Hint: For example, to solve for (a), Assets Liabilities = Equity...
-
The financial statements of TSMC are presented in Appendix A. The complete annual report, including the notes to the financial statements, is available at the companys website. Instructions Refer to...
Study smarter with the SolutionInn App