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On January 1, 2019, Paul acquired 80% of Saul. Information regarding the income and equity structure of the 2 companies as of the year ended December 31, 2019, is as follows: Paul Corp Saul Corp Internally generated net income Common shares outstanding during the year $114,000 $72,000 25,000 12,000 Warrants to acquire Paul stock, outstanding during the year 8% convertible (into Saul shares), $100 par preferred shares outstanding during the year Nonconvertible preferred shares outstanding 4,000 1,000 1,200 500 1) The warrants to acquire Paul stock were issued in 2018. Each warrant can be exchanged for one share of Paul stock at an exercise price of $14 per share 2) Each share of convertible preferred stock can be converted into 3 shares of Saul common stock. The preferred stock pays an annual dividend of $9,600. Paul owns 70% of the Convertible preferred stock. 3) The nonconvertible preferred stock was issued in 2017, and pays a 6 month dividend of $750 Compute the basic EPS for the year ended December 31, 2019

On January 1, 2019, Paul acquired 80% of Saul. Information regarding the income and equity structure of the 2 companies as of the year ended December 31, 2019, is as follows: Paul Corp Saul Corp Internally generated net income Common shares outstanding during the year $114,000 $72,000 25,000 12,000 Warrants to acquire Paul stock, outstanding during the year 8% convertible (into Saul shares), $100 par preferred shares outstanding during the year Nonconvertible preferred shares outstanding 4,000 1,000 1,200 500 1) The warrants to acquire Paul stock were issued in 2018. Each warrant can be exchanged for one share of Paul stock at an exercise price of $14 per share 2) Each share of convertible preferred stock can be converted into 3 shares of Saul common stock. The preferred stock pays an annual dividend of $9,600. Paul owns 70% of the Convertible preferred stock. 3) The nonconvertible preferred stock was issued in 2017, and pays a 6 month dividend of $750 Compute the basic EPS for the year ended December 31, 2019

Intermediate Accounting: Reporting And Analysis
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
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On January 1, 2019, Paul acquired 80% of Saul. Information regarding the income and equity structure of the 2 companies as of the year ended December 31, 2019, is as follows: Paul Corp Saul Corp $72,000 12,000 Internally generated net income Common shares outstanding during the year Warrants to acquire Paul stock, outstanding during the year 8% convertible (into Saul shares), $100 par preferred shares $114,000 25,000 4,000 1,000 outstanding during the year 1,200 Nonconvertible preferred shares outstanding 500 1) The warrants to acquire Paul stock were issued in 2018. Each warrant can be exchanged for one share of Paul stock at an exercise price of $14 per share 2) Each share of convertible preferred stock can be converted into 3 shares of Saul common stock. The preferred stock pays an annual dividend of $9,600. Paul owns 70% of the Convertible preferred stock. 3) The nonconvertible preferred stock was issued in 2017, and pays a 6 month dividend of $750 Compute the basic EPS for the year ended December 31, 2019
Transcribed Image Text:On January 1, 2019, Paul acquired 80% of Saul. Information regarding the income and equity structure of the 2 companies as of the year ended December 31, 2019, is as follows: Paul Corp Saul Corp $72,000 12,000 Internally generated net income Common shares outstanding during the year Warrants to acquire Paul stock, outstanding during the year 8% convertible (into Saul shares), $100 par preferred shares $114,000 25,000 4,000 1,000 outstanding during the year 1,200 Nonconvertible preferred shares outstanding 500 1) The warrants to acquire Paul stock were issued in 2018. Each warrant can be exchanged for one share of Paul stock at an exercise price of $14 per share 2) Each share of convertible preferred stock can be converted into 3 shares of Saul common stock. The preferred stock pays an annual dividend of $9,600. Paul owns 70% of the Convertible preferred stock. 3) The nonconvertible preferred stock was issued in 2017, and pays a 6 month dividend of $750 Compute the basic EPS for the year ended December 31, 2019
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