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Computation of diluted eps

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Reference no: EM132083389

Given the following for the Austin Company:

Net Income: $300,000

Tax Rate: 30%

Closing Market Price per common share: $32

Average Market Price per common share: $30

Common shares outstanding (entire year): 200,000

The following Capital Structure items existed for the entire year:

1. 6%, Cumulative Preferred Stock (Total par $200,000), Convertible to 20,000 common shares.

2. Stock Options to purchase 12,000 Common Shares at $31 per share.

In the computation of Diluted EPS, the denominator is:

Reference no: EM132083389

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