"Homework Quiz—10 02-23

"Homework Quiz—10 02-23

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Homework Quiz—10 Name Section ABC Company had 490,000 issued and outstanding shares of $10 par common stock at 1/1/10. ABC also had 10,000 shares of $100 par, 6% preferred stock issued and outstanding at 1/1/10. During 2010 ABC did the following: a. Issued 24,000 shares of $10 par common stock on April 1. b. Purchased 9,600 shares of treasury stock on May 1. c. Borrowed $600,000 using 6% Bonds on June 1. Bonds pay 3% interest semiannually on 6/1 and 12/1. d. Sold 3,600 treasury shares on August 1 e. Split the common stock 2 for 1 on October 1. Required : In the table below, calculate 2010 Weighted Average Shares Outstanding. Dates Outstanding Shares Outstanding Restatement Fraction of the Year Weighted Shares Outstanding 1/1 to 3/31 490,000 2 3/12 245,000 4/1 to 4/30 514,000 2 1/12 85,667 5/1 to 7/31 504,400 2 3/12 252,200 8/1 to 9/30 508,000 2 2/12 169,333 10/1 to 12/31 1,016,000 3/12 254,000 Weighted Average 1,006,200 Required: If Net Income was $610,000, calculate 2010 Basic Earnings Per Share (rounded to the
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Unformatted text preview: nearest cent). Preferred dividends = (6% x $100 x 10,000) = 60,000 Basic EPS = ($610,000 - $60,000)/1,006,200 = $.55 per share 1 Homework Quiz10 Name Section ABC Company had 490,000 issued and outstanding shares of $10 par common stock at 1/1/10. ABC also had 10,000 shares of $100 par, 6% preferred stock issued and outstanding at 1/1/10. During 2010 ABC did the following: a. Issued 24,000 shares of $10 par common stock on April 1. b. Purchased 9,600 shares of treasury stock on May 1. c. Borrowed $600,000 using 6% Bonds on June 1. Bonds pay 3% interest semiannually on 6/1 and 12/1. d. Sold 3,600 treasury shares on August 1 e. Split the common stock 2 for 1 on October 1. Required : In the table below, calculate 2010 Weighted Average Shares Outstanding. Required: If Net Income was $610,000, calculate 2010 Basic Earnings Per Share (rounded to the nearest cent). 2...
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This note was uploaded on 04/09/2011 for the course MGMT 351 taught by Professor Staff during the Winter '08 term at Purdue University-West Lafayette.

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"Homework Quiz—10 02-23

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