Jasper Inc., a publicly traded corporation, has a December 31 year end. For the 2021 fiscal year, there were 100,000 common shares outstanding all year. Net income for the year ended December 31, 2021 was $860,000. The company's income tax rate is 25%.

In 2019, Jasper issued a 4% convertible bond with a face value of $2,000,000. Each $1,000 bond is convertible into 20 common shares. No bonds have been converted as of December 31, 2021.

On August 1, 2020, Jasper issued 50,000, $2, cumulative convertible preferred shares. Two preferred shares are convertible into one common share. On June 15, 2021, the preferred share dividend was declared and paid. No preferred shares have been converted as of December 31, 2021.

Required:

Calculate basic and diluted EPS for Jasper Inc. for the 2021 year-end.

Answer rating: 100% (QA)

Solution Calculation Basic EPS Net income 860000 Less Preference dividend 100000 Net income availa... View the full answer