CH Holdings Inc has net earnings of $5,456,000 for the year ended 31 December 20X5. It has convertible bonds currentlyoutstanding with a face value of $8,500,000 and a book value of $7,871,852 at 1 January, 20X5. The bonds have a coupon interest of2.5% payable semi-annually on 30 June and 31 December. The effective interest rate on similar bonds with no conversion option at thetime of issue was 6.5%. The bonds have a conversion price of $40 per share. The weighted average number of shares outstanding forthe year was 1,500,000, CH's income tax rate is 28%.Required:Compute the basic and diluted EPS for CH Holdings Inc. (Do not round intermediate calculations and round your answer to 2decimal places.)Basic EPSDiuted EPS

computing basic and diluted EPS Basic EPS= ($5456000) /$1500000 Basic EPS=$ 3.637 per Share Dilute…

CH Holdings Inc has net earnings of $5,456,000 for the year ended 31.December 20X5. It has convertible bonds currently utstanding with a face value of $8,500,000 and a book value of $7,871,852 at 1 January, 20X5. The bonds have a coupon interest of 5% payable semi-annually on 30 June and 31 December. The effective interest rate on similar bonds with no conversion option at the ime of issue was 6.5%. The bonds have a conversion price of $40 per share. The weighted average number of shares outstanding for he year was 1,500,000. CH's income tax rate is 28%. Required: Compute the basic and diluted EPS for CH Holdings Inc. (Do not round intermediate calculations and round your answer to 2 decimal places.) Basic EPS

CH Holdings Inc has net earnings of $5,456,000 for the year ended 31.December 20X5. It has convertible bonds currently utstanding with a face value of $8,500,000 and a book value of $7,871,852 at 1 January, 20X5. The bonds have a coupon interest of 5% payable semi-annually on 30 June and 31 December. The effective interest rate on similar bonds with no conversion option at the ime of issue was 6.5%. The bonds have a conversion price of $40 per share. The weighted average number of shares outstanding for he year was 1,500,000. CH's income tax rate is 28%. Required: Compute the basic and diluted EPS for CH Holdings Inc. (Do not round intermediate calculations and round your answer to 2 decimal places.) Basic EPS

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter20: Financing With Derivatives

Section: Chapter Questions

Problem 14P

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