Calculate the Incremental EPS for the Following Instrument: Convertible Bonds

question 25

Multiple Choice

Calculate the incremental EPS for the following instrument: Convertible bonds outstanding, yield of 5% and coupon rate of 5%
$2,000,000
Issue date
January 1, 2019
Maturity date
December 31, 2024
Conversion rate for each $1,000 bond
20 ordinary shares
Tax rate
25%

• A)0.63
• B)1.88
• C)40,000
• D)75,000

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