The information below pertains to Barkley Company for 2015. Net income for the year ...............................................$1,200,000 7% convertible
Question:
The information below pertains to Barkley Company for 2015.
Net income for the year ...............................................$1,200,000
7% convertible bonds issued at par ($1,000 per bond); each bond is convertible into
30 shares of common stock ............................................ 2,000,000
6% convertible, cumulative preferred stock, $100 par value; each share is convertible
into 3 shares of common stock ......................................... 4,000,000
Common stock, $10 par value .......................................... 6,000,000
Tax rate for 2015 ......................................................... 40%
Average market price of common stock ...............................$25 per share
There were no changes during 2015 in the number of common shares, preferred shares, or convertible bonds outstanding. There is no treasury stock. The company also has common stock options (granted in a prior year) to purchase 75,000 shares of common stock at $20 per share.
Instructions
(a) Compute basic earnings per share for 2015.
(b) Compute diluted earnings per share for 2015.
Common StockCommon stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...
Step by Step Answer:
Intermediate Accounting 2014 FASB Update
ISBN: 978-1118147290
15th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield