Ignatius Corporation Had 7 Million Shares of Common Stock Outstanding

question 127

Short Answer

Ignatius Corporation had 7 million shares of common stock outstanding during the current calendar year.It issued ten thousand $1,000,convertible bonds on January 1.Each bond is convertible into 50 shares of common stock.The bonds were issued at face amount and pay interest quarterly at an annual rate of 10%.On June 30,Ignatius issued 100,000 shares of $100 par 6% cumulative preferred stock.Dividends are declared and paid semiannually.Ignatius has an effective tax rate of 40%.Ignatius would report the following EPS data (rounded)on its net income of $20 million:

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Definitions:

Martin Luther

A German monk, theologian, and seminal figure in the Protestant Reformation who challenged the teachings of the Roman Catholic Church.

Design Argument

An argument for the existence of God or, more generally, for an intelligent creator based on perceived evidence of deliberate design in the natural or physical world.

Inferior Deity

A lesser god or divine being considered to have less power or authority compared to a supreme deity in a hierarchical pantheon.

David Hume

An 18th-century Scottish philosopher known for his skepticism of religion and emphasis on empiricism and the scientific method.