On December 31, 2010, Feterik Company had 7,000 shares of common stock issued and outstanding. On April 1, 2011, an additional 1,000 shares of common stock were issued and on July 1, 500 more shares were issued. On October 1, 2011, Feterik issued 10, $1,000 maturity value, 8% convertible bonds. Each bond is convertible into 40 shares of common stock. No bonds were converted into common stock in 2011. Assuming there are no antidilutive securities, what is the number of shares Feterik should use to compute diluted earnings per share for the year ended December 31, 2011?

Question

Quizplus · Accepted Answer

The Answer of On December 31, 2010, Feterik Company had 7,000 shares of common stock issued and outstanding. On April 1, 2011, an additional 1,000 shares of common stock were issued and on July 1, 500 more shares were issued. On October 1, 2011, Feterik issued 10, $1,000 maturity value, 8% convertible bonds. Each bond is convertible into 40 shares of common stock. No bonds were converted into common stock in 2011. Assuming there are no antidilutive securities, what is the number of shares Feterik should use to compute diluted earnings per share for the year ended December 31, 2011?

On December 31, 2010, Feterik Company Had 7,000 Shares of Common