Diluted earnings per chare of common stock.


During 2009, the Ellis Corporation had 370,000 shares of $20 par common stock outstanding. On January 1, 2009, 2,000, 8 percent bonds were issued with a maturity value of $1,000 each. To enchance the bond sale, the company offered a conversion of 50 shares of common stock for each bond at the option of the purchaser. Net income for 2009 was $464,000. The income tax rate was 30 percent. Compute the diluted earnings per chare of common stock.

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Accounting Basics: Diluted earnings per chare of common stock.
Reference No:- TGS0516495

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