Question - Computing consolidated earnings per share

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Question - Computing consolidated earnings per share (EPS)

Assume the following facts about a parent and its 75% owned subsidiary company:

Parent Subsidiary Net income $210,000 $49,000

Common shares outstanding 50,000 28,000 (21,000 = 75% owned by parent)

Convertible preferred stock Dividends = $20,100

Convertible into 9,000 shares of common stock

Convertible bonds Interest expense after tax = $7,100

Convertible into 6,000 shares of common stock

Required -

a. Compute basic earnings per share.

b. Compute diluted earnings per share.

 

Reference no: EM132681159

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