Reference no: EM132745098
Question: On December 31, 2020, Dow Steel Corporation had 710,000 shares of common stock and 311,000 shares of 7%, noncumulative, nonconvertible preferred stock issued and outstanding. Dow issued a 4% common stock dividend on May 15 and paid cash dividends of $510,000 and $80,000 to common and preferred shareholders, respectively, on December 15, 2021.
On February 28, 2021, Dow sold 63,000 common shares. In keeping with its long-term share repurchase plan, 4,000 shares were retired on July 1. Dow's net income for the year ended December 31, 2021, was $2,650,000. The income tax rate is 25%. Also, as a part of a 2020 agreement for the acquisition of Merrill Cable Company, another 35,000 shares (already adjusted for the stock dividend) are to be issued to former Merrill shareholders on December 31, 2022, if Merrill's 2022 net income is at least $610,000. In 2021, Merrill's net income was $740,000.
As part of an incentive compensation plan, Dow granted incentive stock options to division managers at December 31 of the current and each of the previous two years. Each option permits its holder to buy one share of common stock at an exercise price equal to market value at the date of grant and can be exercised one year from that date. Information concerning the number of options granted and common share prices follows:
Options Granted Date Granted(adjusted for the stock dividend)Share PriceDecember 31, 2019 18,000 $28 December 31, 2020 13,000 $37 December 31, 2021 16,500 $36
The market price of the common stock averaged $36 per share during 2021.
On July 12, 2019, Dow issued $900,000 of convertible 8% bonds at face value. Each $1,000 bond is convertible into 40 common shares (adjusted for the stock dividend).
Required: Compute Dow's basic and diluted earnings per share for the year ended December 31, 2021. (Enter your answers in thousands. Round "Earnings per share" answers to 2 decimal places. Do not round intermediate calculations)
|
How much value did management add to stockholders
: What was HHH's Economic Value Added (EVA), i.e., how much value did management add to stockholders' wealth during the year?
|
|
Calculate loquat corporations taxable income
: The Loquat Corporation has book net income of $50,000 for the current year. Included in this figure are the following items, which are reported.
|
|
What the dollar-weighted return on investment is
: What the dollar-weighted return on investment is? Suppose you purchase one share of the stock of Cereal Correlation Company at the beginning of year
|
|
How is the standard variable overhead rate different
: When analyzing the total variable overhead cost variance, How is standard variable overhead rate different from the standard labour rate in variance analysis?
|
|
Compute dows basic and diluted earnings per share
: On December 31, 2020, Dow Steel Corporation had 710,000 shares of common stock and 311,000 shares of 7%, noncumulative, nonconvertible preferred stock issued.
|
|
How representing total production for the current period is
: The beginning inventory is 400 units, the number of units set forth in the production budget, representing total production for the current period, is
|
|
Harmans widow and the beneficiary
: Which of the following is the correct course of action you should take in the claims process?
|
|
Find how much will operating income change
: Lemon Inc. are 72%, current sales are $592,000, and fixed costs are $202,000. How much will operating income change if sales increase by $45,000?
|
|
Determine the standard fixed overhead cost per unit
: Determine the standard fixed overhead cost per unit at 27,000 hours, which is 100% of normal capacity, if the favorable fixed factory overhead volume
|