QUESTION 3 Not complete Points out of 2.00 P Flag question Computing Basic and D

Question

QUESTION 3 Not complete Points out of 2.00 P Flag question Computing Basic and Diluted Earnings per Share During 2015, Park Corporation had 65,000 shares of $10 par value common stock and 15,000 shares of 896, $50 par value convertible preferred stock outstanding. Each share of preferred stock may be converted into three shares of common stock. Park Corporation's 2015 net income was $440,000. Required a. Compute the basic earnings per share for 2015. (Round answer to two decimal places.) b. Compute the diluted earnings per share for 2015. (Round answer to two decimal places.) Check

Explanation / Answer

Basic EPS= Net income after paying to preferred stock/ no. of equity shares =(440000-15000*50*8%)/65000 $       5.85 Diluted EPS= Net income/( no. of equity shares+ preferred stock converted) =(440000)/(65000+15000*3) $       4.00

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