51．Selected information from Doors, Inc.’s financial activities in the year 2005 included the following: § Net income was $372,000. § 100,000 shares of common stock were outstanding on January 1. § The average market price per share was $18 in 2005. § Dividends were paid in 2005. § 2,000, 6 percent $1,000 par value convertible bonds, which are convertible at a ratio of 25 shares for each bond, were outstanding the entire year. § Doors, Inc.’s tax rate is 40%. Doors, Inc.’s diluted earnings per share (Diluted EPS) for 2005 was closest to: A) $2.96. B) $3.72. C) $3.28. D) $3.46.
52．Based on the following data, how many shares of common stock should be used to calculate diluted earnings per share? § Net income of $1,500,000, tax retention rate of 60% § 1,000,000 shares of common are outstanding at the beginning of the year. § 10,000, 6% convertible bonds with each bond convertible into 20 shares of common stock were issued at par ($100) on June 30th of this year. § The firm has 100,000 warrants outstanding all year with an exercise price of $25 per share. § The average stock price for the period is $20, and the ending stock price is $30. A) 1,266,667. B) 1,100,000. C) 1,000,000. D) 1,016,667.
53.Which of the following statements is TRUE regarding the reporting of earnings per share (EPS)? A) Basic EPS must be less than diluted EPS. B) Basic EPS can be less than diluted EPS. C) The EPS when antidilutive securities are converted into shares of common stock is less than basic EPS. D) Diluted EPS must be less than or equal to basic EPS.
54.Which of the following statements regarding the treasury stock method of computing diluted shares is least likely accurate? The treasury stock method: A) increases the total number of shares by less than the number that the exercise of the options would create. B) is used to determine the impact of warrants and options on diluted earnings per share. C) is used when the exercise price of the option is less than the average market price. D) assumes that the hypothetical funds received by the company from the exercise of the options are used to sell shares of the company’s common stock in the market at the average market price.
55.Empire Watch Company’s basic earnings per share (EPS) and diluted earnings per share (Diluted EPS) were both $2.00 in 2004, in 2005 basic EPS was $2.50 but Diluted EPS was $2.25. The fact that basic EPS and diluted EPS were the same in 2004 and different in 2005 could possibly be explained by any of the following EXCEPT: A) Empire Watch purchased its own stock and held it as treasury stock in 2005. B) the average price per share of Empire Watch's common stock was higher in 2005. C) Empire Watch issued convertible preferred stock in 2005. D) Empire Watch issued convertible bonds in 2005. | 
发表于 2008-4-10 12:13
|