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Assume that the following data relative to Chaps, Inc. for 2015is available:

Net Income $1,400,000

Transactions in Common Shares Change Cumulative

Jan. 1, 2012, Beginning number 500,000

Mar. 1, 2012, Purchase of treasury shares (60,000) 440,000

June 1, 2012, Stock split 2-1 440,000 880,000

Nov. 1, 2012, Issuance of shares 120,000 1,000,000

8% Cumulative Convertible Preferred Stock

Sold at par, convertible into 200,000 shares of common

(adjusted for split). $1,000,000

Stock Options

Exercisable at the option price of $25 per share. Average

market price in 2012, $30 (market price and option price

adjusted for split). 60,000 shares

Instructions

(a) Compute the basic earnings per share for 2015.(Round to the nearest penny.)

(b) Compute the diluted earnings per share for 2015.(Round to the nearest penny.)

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Keith Leannon
Keith LeannonLv2
28 Sep 2019

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Assume that the following data relative to Kane Company for 2015is available: Net Income $2,600,000 Transactions in Common SharesChange Cumulative Jan. 1, 2015, Beginning number 700,000 Mar. 1,2015, Purchase of treasury shares (70,000) 630,000 June 1, 2015,Stock split 2-1 630,000 1,260,000 Nov. 1, 2015, Issuance of shares240,000 1,500,000 8% Cumulative Convertible Preferred Stock Sold atpar, convertible into 200,000 shares of common (adjusted forsplit). $1,000,000 Stock Options Exercisable at the option price of$25 per share. Average market price in 2015, $30 (market price andoption price adjusted for split). 90,000 shares Instructions (a)Compute the basic earnings per share for 2015. (Round to thenearest penny.) (b) Compute the diluted earnings per share for2015. (Round to the nearest penny.)

Assume that the following data relative to Kane Company for 2015is available:

Net Income

$2,800,000

Transactions in Common Shares

Change

Cumulative

Jan. 1, 2015, Beginning number

720,000

Mar. 1, 2015, Purchase of treasury shares

(53,400

)

666,600

June 1, 2015, Stock split 2-1

666,600

1,333,200

Nov. 1, 2015, Issuance of shares

228,000

1,561,200

8% Cumulative Convertible Preferred Stock

Sold at par, convertible into 180,000 shares of common (adjustedfor split).

$900,000

Stock Options

Exercisable at the option price of $25 per share. Average marketprice in 2015, $30 (market price and option price adjusted forsplit).

93,000

shares

a.Compute weighted-average shares outstanding for 2015.

b.Compute the basic earnings per share for 2015.(Round answer to 2 decimal places, e.g.52.75.)

c.Compute the diluted earnings per share for 2015.(Round answer to 2 decimal places, e.g.52.75.)

On January 1, 2013, Belk, Inc. had outstanding 440,000 commonshares (par $1) that originally sold for $20 per share, and 4,000shares of 10% cumulative preferred stock (par $100), convertibleinto 40,000 common shares. On October 1, 2013, Belk issued anadditional 16,000 shares of common stock at $33. At December 31,2013, there were common stock options outstanding, issued in 2012,and exercisable for 20,000 shares of common stock at an exerciseprice of $30. The market price of the common stock at year-end was$48. During the year the price of the common shares had averaged$40. Net Income was $650,000. The tax rate for the year was 40%.Compute basic and diluted EPS for the year ended December 31,2013.

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