On January 1, 2021, Ajax Corporation had 500,000 shares of common stock issued, and 450,000 shares...

  

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On January 1, 2021, Ajax Corporation had 500,000 shares of common stock issued, and 450,000 shares of common stock outstanding. On May 1 Ajax re-sold 30,000 treasury shares and on August 1" Ajax announced a 3 for 1 stock split. Throughout 2021, Ajax had $10,000,000 of 4 percent convertible bonds outstanding, which are convertible into 350,000 (post-split) common shares of stock. Net income in 2021 was $1,00,000. Assuming an income tax rate of 20 percent, what should be basic and diluted earning per share for calendar year 2021, respectively? $1.32; $1.24 $1.37; $1.28 O$1.37; 1.32 O$1.32: 1.28 Question 12 (12 points) 1) Listen On December 31, 2021, Ajax Corporation changed its inventory valuation method from LIFO cost to FIFO cost for both financial statement and income tax purposes. The change will result in a $230,000 increase in beginhing inventory. Assume a 20 percent income tax rate and assume Ajax will have to pay taxes on the cumulated effect on net income. By how much will retained earnings be adjusted to account for the cumulative effect of this change in accounting principle? O Debit of $184,000 Debit of $230,000 Credit of $184,000 Credit of $230,00 Credit of $46.000 On January 1, 2021, Ajax Corporation had 500,000 shares of common stock issued, and 450,000 shares of common stock outstanding. On May 1 Ajax re-sold 30,000 treasury shares and on August 1" Ajax announced a 3 for 1 stock split. Throughout 2021, Ajax had $10,000,000 of 4 percent convertible bonds outstanding, which are convertible into 350,000 (post-split) common shares of stock. Net income in 2021 was $1,00,000. Assuming an income tax rate of 20 percent, what should be basic and diluted earning per share for calendar year 2021, respectively? $1.32; $1.24 $1.37; $1.28 O$1.37; 1.32 O$1.32: 1.28 Question 12 (12 points) 1) Listen On December 31, 2021, Ajax Corporation changed its inventory valuation method from LIFO cost to FIFO cost for both financial statement and income tax purposes. The change will result in a $230,000 increase in beginhing inventory. Assume a 20 percent income tax rate and assume Ajax will have to pay taxes on the cumulated effect on net income. By how much will retained earnings be adjusted to account for the cumulative effect of this change in accounting principle? O Debit of $184,000 Debit of $230,000 Credit of $184,000 Credit of $230,00 Credit of $46.000

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