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Calculate diluted earnings per share

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Reference no: EM132908754

Question - DBT Inc. had net income for the fiscal year ended June 30, 2021, of $5,900,000. The tax rate was 30%. There were 600,000 common shares outstanding throughout 2021 DBT Inc. had the following outstanding during 2021:

1. Options to buy 170,000 common shares at $40 per share. Market price of the shares was $55.

2. 5% bonds non-convertible bonds with a principal amount of $28,000,000 issued at par.

3. 4% convertible bonds with a principal amount of $32,000,000, issued at par. Each $1,000 bond is convertible into 30 common shares.

4. 200,000 convertible preferred shares entitled to a cumulative dividend of $9 per share. Each preferred share is convertible into 2.5 common shares.

Required -

a) Calculate basic earnings per share for Fiscal 2021.

b) Calculate diluted earnings per share for Fiscal 2021.

Reference no: EM132908754

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