Datatec, Inc

question 72

Multiple Choice

Datatec, Inc., had 400,000 shares of $20 par common stock and 40,000 shares of $100 par, 6% cumulative, convertible preferred stock outstanding for the entire year ended December 31, 2011. Each share of the preferred stock is convertible into 5 shares of common stock. Datatec's net income for 2011 was $1,680,000. For the year ended December 31, 2011, the diluted earnings per share is

• A) $2.40.
• B) $2.80.
• C) $3.60.
• D) $4.20.

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Definitions:

Type-II Survivorship

A survivorship curve in which individuals are equally likely to die at any age, representing a relatively constant mortality rate throughout the organism's life.

Exponential Growth

Growth that occurs at a rate that becomes ever more rapid in proportion to the growing total number or size.

J Shape

Often refers to a type of curve, graph, or object shape that resembles the letter "J"; specific context can greatly influence its meaning.

Territoriality

A behavioral pattern among animals and humans involving the establishment and defense of a territory for living, feeding, or breeding.