Step by Step calculations Anirudh Corporation has the following capital structure as at December 31, 20x3:Convertible bonds, 5%$15,832,154Preferred Shares – Series A, 4%, noncumulative4,000,000Preferred Shares – Series B, $5, cumulative, 70,000 shares issued and7,000,000outstandingContributed Surplus – Convertible BondsContributed Surplus – Stock OptionsCommon Shares, 1,700,000 shares issued and outstanding225,000110,00022,400,000Additional Information –The convertible bonds were issued on December 31, 20x0. Bonds of similar riskyielded 4.4% at the time. The bonds mature on December 31, 20x15 and payinterest on Jun 30 and Dec 31. The face value of the bonds is $15,000,000. Each$1,000 bond is convertible into 30 common shares at the option of the holder.The net income for the year ended December 31, 20x4 is $2,800,000.No preferred share dividend had been declared since December 31, 20x2. OnDecember 31, 20x4, Anirudh declared a total of $1,500,000 in dividends.The following common stock transactions took place in 20x4:April 30 – Repurchased 60,000 common sharesAugust 31 – Issued 150,000 common sharesThe Series B preferred shares are convertible into 4 common shares at the option ofthe holder.There are two stock option grants outstanding:Series B12: 50,000 options at an exercise price of $25Series B13: 75,000 options at an exercise price of $18On March 31, 20x3, Anirudh purchased a subsidiary. One of the conditions of thepurchase was the issue of an additional 35,000 common shares on March 31, 20x5if the cumulative net income of the subsidiary post-acquisition was $2,000,000.This was met on November 30, 20x4. As of December 31, 20x4, the cumulative netincome of the subsidiary was $2,150,000 and management believes that there willbe no decrease in the cumulative net income of the subsidiary between December31, 20x4 and March 31, 20x5.The average stock price during the year was $22The tax rate is 25%Required –Calculate the Basic and Diluted EPS for the December 31, 20x4 year end. Pleaseshow your EPS calculations accurate to 3 decimal places.Assume now that the company declared a 2:1 stock split on June 30, 20x4.Calculate the weighted average number of common shares.а.b.

Basic and Diluted EPS: The net income of a company represents the earnings that belong to the…

Anirudh Corporation has the following capital structure as at December 31, 20x3: Convertible bonds, 5% Preferred Shares - Series A, 4%, noncumulative Preferred Shares - Series B, $5, cumulative, 70,000 shares issued and outstanding Contributed Surplus - Convertible Bonds Contributed Surplus - Stock Options Common Shares, 1,700,000 shares issued and outstanding Additional Information - The convertible bonds were issued on December 31, 20x0. Bonds of similar risk yielded 4.4% at the time. The bonds mature on December 31, 20x15 and pay interest on Jun 30 and Dec 31. The face value of the bonds is $15,000,000. Each $1,000 bond is convertible into 30 common shares at the option of the holder. The net income for the year ended December 31, 20x4 is $2,800,000. No preferred share dividend had been declared since December 31, 20x2. On December 31, 20x4, Anirudh declared a total of $1,500,000 in dividends. a. The following common stock transactions took place in 20x4: April 30 - Repurchased 60,000 common shares August 31 - Issued 150,000 common shares b. $15,832,154 4,000,000 7,000,000 There are two stock option grants outstanding: Series B12: 50,000 options at an exercise price of $25 Series B13: 75,000 options at an exercise price of $18 225.000 110.000 22,400,000 The Series B preferred shares are convertible into 4 common shares at the option of the holder. Required - Calculate the Basic and Diluted EPS for the December 31, 20x4 year end. Please show your EPS calculations accurate to 3 decimal places. Assume now that the company declared a 2:1 stock split on June 30, 20x4. Calculate the weighted average number of common shares. On March 31, 20x3, Anirudh purchased a subsidiary. One of the conditions of the purchase was the issue of an additional 35,000 common shares on March 31, 20x5 if the cumulative net income of the subsidiary post-acquisition was $2,000,000. This was met on November 30, 20x4. As of December 31, 20x4, the cumulative net income of the subsidiary was $2,150,000 and management believes that there will be no decrease in the cumulative net income of the subsidiary between December 31, 20x4 and March 31, 20x5. The average stock price during the year was $22 The tax rate is 25%