View the step-by-step solution to:

During 2017, Bacardi Inc. had 500,000 shares of common stock and 50,000 shares of 6% cumulative preferred stock outstanding. The non-convertible...

During 2017, Bacardi Inc. had 500,000 shares of common stock and 50,000 shares of 6% cumulative preferred stock outstanding. The non-convertible preferred stock has a par value of $100 per share. Bacardi did not declare or pay any dividends during 2017. Bacardi's net income for the year ended December 31, 2017, was $2.5 million. The income tax rate is 40%. Bacardi granted 10,000 stock options to its executives on January 1 of this year. Each option gives its holder the right to buy 20 shares of common stock at an exercise price of $29 per share. The market price of the common stock averaged $30 per share during 2017, and the stock price on December 31, 2017 was $32 per share.


Q 1) Basic earnings per share reported by Bacardi Inc. for 2017 is closest to: A) $5.00

B) $4.40

C) $4.34

D) $4.24

Q 2) Diluted earnings per share reported by Bacardi Inc. for 2017 is closest to: A) $5.00

B) $4.40

C) $4.34

D) $4.24

Top Answer

Sign up to view the full answer

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access.

    Browse Documents
  • -

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
Ask a homework question - tutors are online