The Following Information Relates to the SPE Company in 2014

question 124

Multiple Choice

The following information relates to the SPE company in 2014. Net income: $50,000
Common shares outstanding on January 1: 30,000
On June 30 issued 2,000 8% cumulative convertible preferred shares
$100 par, each convertible into 10 common shares Issued a 40% stock dividend on Sept.30
What is the diluted EPS? (Rounded to the nearest cent)

• A)$1.00
• B)$0.76
• C)$0.81
• D)$0.89

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Definitions:

Modification

The act of making changes or alterations to a document, contract, or agreement, often requiring mutual consent of involved parties.

Discharges

The release or dismissal from a legal obligation, debt, or responsibility, such as the discharge of a bankruptcy or contractual duty.

Uniform Commercial Code

A set of laws that provide legal standards and regulations for commercial transactions and business dealings.

Common Law

A body of unwritten laws based on legal precedents established by the courts, as opposed to statutory laws enacted by legislative bodies.