Calculate basic eps for year seven

Assignment Help Financial Accounting
Reference no: EM132864852

Throughout Year 7, Bob the Builder has 400,000 common shares outstanding (no preferred shares issued or outstanding). In addition, at December 31, Year 7, Bob has 5,000 convertible bonds outstanding with 20-year maturity, $1,000 face value, 7% coupon payable once a year, issued at par in Year 2. Each $1,000 bond is convertible into 20 common shares after June 30, Year 5. Bob reported net income of $600,000 for Year 7. Their income tax rate is 30%. For simplicity, please assume that the entire proceed from the sale of bonds was allocated to bonds at the issuance of the bonds.

Problem (1) Calculate basic EPS for Year 7.

Problem (2) Calculate diluted EPS for Year 7.

Reference no: EM132864852

Questions Cloud

Resource management : Compare and contrast the operational and managerial impacts of the aggregate planning decisions in terms of customer satisfaction.
Lasa-national culture : The senior management of your company (a small appliance manufacturer) is preparing to open its first product distribution center outside the United States
How much will net income increase or decrease : Decides the buy the part externally instead for $156,520 and $4,065 of the fixed costs will be avoided. How much will net income increase or decrease?
What must the beta be for the other stock in portfolio : If one of the stocks has a beta of 1.11 and the total portfolio is equally as risky as the market, what must the beta be for the other stock in your portfolio?
Calculate basic eps for year seven : Calculate basic EPS for Year 7. Throughout Year 7, Bob the Builder has 400,000 common shares outstanding (no preferred shares issued or outstanding).
Small advertising agency : You manage a small advertising agency that employs two illustrators, two copywriters, and two account executives.
Find balance of accounts receivable in the general ledger : Sales for October are $24,000, for November $26,000 and December $28,000. Find balance of Accounts Receivable in the general ledger
Which form of market efficiency is violated : Your best friend has concluded from examining past price behaviour. If your friend is correct, which form of market efficiency is violated?
Calculate the cost of equity using dividend discount model : Floyd Industries stock has a beta of 1.2. The company just paid a dividend of $0.90, Calculate the cost of equity using the dividend discount model method.

Reviews

Write a Review

Financial Accounting Questions & Answers

  Customer profitability analysis

Customer Profitability Analysis Hystandard Services, Inc. provides residential painting services for three home building companies, Alpine, Blue Ridge, and Pineola, and it uses a job costing system for determining the costs for completing each job. T..

  The currently dominant floating exchange rate system

There are many possible exchange rate systems that can be employed by nations of the world. What are the advantages and disadvantages of the currently dominant floating exchange rate system? What alternative system(s) might be better suited to manage..

  Inherent risk and materiality

describe the feature of the firm you believe affects inherent risk and explain how and why.- Limit your inherent risk analysis to the verbal information in the case and not the financial statement data.

  How many contracts should the company long or short

Assume the company wishes to increase the beta to 2. How many contracts should the company long or short

  What is the balance of net plant and equipment

Total assets equal $3 million, while current assets equal $750,000. Notes payable equal $50,000, What is the balance of net plant and equipment

  What is the difference between CCs expected ROE

Assuming a 2S% tax rate on taxable income, what is the difference between CCs expected ROE if it finances these assets with 350/0 debt

  Extraordinary items and ratio analysis

"Extraordinary Items and Ratio Analysis"  Please respond to the following: Choose at least two (2) items or events that you would consider to be extraordinary to a company. Propose the manner in which you would disclose these items or events to inves..

  Supposedly better accounting system

The controller of a retail company has just had a $50,000 request to implement an ABC system quickly turned down. A senior VP, in rejecting the request, noted, “Given a choice, I will always prefer a $50,000 investment in improving things a customer ..

  Question you have been asked by the managerial committee of

question you have been asked by the managerial committee of a company fictional or real to freshly implement one of the

  What was the interest revenue that spacepower earned

On January? 1, 2014?, Spacepower ?Inc., purchased $70,000 face value of the 2?% bonds of Service Express, Inc.?, at 108. The bonds mature on January? 1, 2019. For the year ended December? 31, 2017?, Spacepower received cash interest of $1,400. What w..

  How would you choose to finance the equipment

ou are looking to purchase a new piece of equipment costing $10,000 that will require funds that you do not have available. How you choose to finance equipment

  Discuss what is meant by corporate social responsibility

Discuss what is meant by Corporate Social Responsibility (CSR) and why some companies are providing these types of disclosures?

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd