accounting 408281

Exercise 16 25 Your answer is incorrect. Try again. On January 1, 2012, Lindsey Company issued 10 year, $3,056,000 face value, 6% bonds, at par. Each $1,000 bond is convertible into 21 shares of Lindsey common stock. Lindsey’s net income in 2013 was $315,000, and its tax rate was 40%. The company had 103,000 shares of common stock outstanding throughout 2012. None of the bonds were converted in 2012. (a) Compute diluted earnings per share for 2012. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share $ (b) Compute diluted earnings per share for 2012, assuming the same facts as above, except that $1,030,000 of 6% convertible preferred stock was issued instead of the bonds. Each $100 preferred share is convertible into 5 shares of Lindsey common stock. (Round answer to 2 decimal places, e.g. $2.55.) Diluted earnings per share $