Solving problem of online network inc

Reference no: EM131792565

Question: Online Network, Inc., has net income of $600,000 in the current fiscal year. There are 100,000 shares of common stock outstanding along with convertible bonds, which have a total face value of $1.4 million. The $1.4 million is represented by 1,400 different $1,000 bonds. Each $1,000 bond pays 5 percent interest. The conversion ratio is 20. The firm is in a 30 percent tax bracket.

a. Calculate basic earnings per share.

b. Calculate diluted earnings per share.

Reference no: EM131792565

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