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Compute the basic and diluted EPS

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Reference no: EM133053997

Question - Assume that the following data relative to Metro Co. for 20x1 is available:

Net Income (40% tax rate): $3,200,000

Transactions in common shares 1/1 Beginning number 1,000,000 shares 3/1

Purchase of treasury shares (60,000) 6/1 Stock split, 3 for 19% cumulative convertible preferred stock

Issued (in 20x0) at par ($1,000,000), convertible into 200,000 shares of common stock.

Stock options No stock option was exercised in 20x1, but exercisable at the option price of $35 per share. If exercised, 60,000 common shares would be issued. Average market price in 20x1 is $40. Compute the basic and diluted EPS for 20x1.

Reference no: EM133053997

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