Reference no: EM131790642

Collins Corp.'s capital structure was as follows:

                                                                               December 31________

                                                                                  Year  4   Year 5

            Outstanding shares of stock:

                        Common                                 100,000             100,000

                        Convertible preferred             10,000                  10,000

                Convertible bonds                     $1,000,000      $1,000,000

During Year 5, Collins paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible into 20,000 shares of common stock. The interest rate of convertible bonds is 9%. For each $1,000 unit convertible bond, it is convertible into 30 shares of common stock.

Assume that the income tax rate is 30%.

1. If net income for Year 5 is $300,000, Collins should report BEPS and DEPS as

2. If net income for Year 5 is $250,000, Collins should report BEPS and DEPS as

3. If net income for Year 5 is $160,000, Collins should report BEPS and DEPS as

If net income for Year 5 is $250,000, Collins should report BEPS and DEPS as