[EPS] COMPUTING EPS WITH CONVERTIBLE DEBENTURES Pam Corporation has $ 108,000 income from its own operations for 2016. And $42,000 income from Sun Corporation, its 70 percent-owned subsidiary. Sun's net income of $60,000 consists of $66,000 operating income less $ 6,000 net-of tax interest on its outstanding 10 percent convertible debentures. Throughout 2016, Pam has 100,000 shares of common stock outstanding, and Sun has 50,000 outstanding common shares. REQUIRED: 1.Compute Pam's diluted earnings per share for 2016, assuming that Sun's bonds are convertible into 10,000 shares of Sun's common stock. 2.Compute Pam's diluted earnings per share for 2016, assuming that Sun's bonds are convertible into 10,000 shares of Pam's common stock.
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- (b) During the year 2017, Nestle Corp. sold 2,000 shares of Polland Co. for P114,600 and purchased 2,000 more shares of Lj Inc. and 1,000 shares of Dwarfy Company. On December 31, 2017, Nestle's equity securities portfolio consisted of the following: Investment Quantity Cost Fair value Lj, Inc. 1,000 shares P45,000 P60,000 Lj, Inc. 2,000 shares 99,000 120,000 Dwarfy Company 1,000 shares 48,000 36,000 Alabang Corp. 2,000 shares 216,000 66,000 Totals P408,000 P282,000 7. What amount of unrealized gain or loss should be reported in the income statement for the year ended December 31, 2017? a. P126,000 unrealized gain b. P126,000 unrealized loss P108,000 unrealized gain d. P108,000 unrealized loss C.Hatton Inc. has equity investments at fair value through profit or loss purchased during 20x4. At the end of 2014, the securities had total market value of P 525,000. As of December 31,20x5, the records show cost and market values as follows: Investment Cost Market value 1 P 100,000 P 90,000 2 190,000 210,000 3 250,000 235,000 The gain or loss that would be reported in profit or loss as a result of the valuation of the securities at the end of 20x5 is____________.Live Large Inc. had the following transactions involving non-strategic investments during 2023. 2023 Apr. 1 Paid $100,050 to buy a 90-day term deposit, $100,000 principal amount, 5.0 %, dated April 1. There was a $50 transaction fee included in the above-noted payment amount. June 12 Purchased 3,000 common shares of Blue Balloon Ltd. at $22.25. There was a $50 transaction fee included in the above-noted payment amount. 9 Purchased 1,800 common shares of Purple Car Corp. at $49.50. There was a $50 transaction fee included in the above-noted payment amount. 20 Purchased 700 common shares of Yellow Tech Ltd. at $15.75. There was a $50 transaction fee included in the above-noted payment amount. July 1 Purchased for $67,412 a 7.0 %, $65,000 Space Explore Inc. bond that matures in eight years when the market interest rate was 6.4%. There was a $50 transaction fee included in the above-noted payment amount. Interest is paid semiannually beginning December 31, 2023. Live Large Inc. plans to…
- luxco acquires participation on Aprin 1, 2012 for 1000000. This investment is financed by (a) share premium for 100.000é (b) an interest-free shareholder loan for 250000€ and (c) bank loan bearing interest at 5% per annum for the balance. make the journal entryBeta Laboratories reported the following footnote related to its convertible debentures. 2.75% series A and B debentures During the third quarter of fiscal 2016, we sold 2.75% Series A Convertible Senior Debentures and 2.75% Series B Convertible Senior Debentures for an aggregate amount of $1.6 billion, net of the underwriters' discount and related fees and expenses of $46 million. The debentures were issued at a price of $1,000 per debenture and were issued under our universal shelf. The debentures rank equal in priority with all of the existing and future unsecured and unsubordinated indebtedness and senior in right of payment to all of the existing and future subordinated indebtedness. The terms governing the debentures limit our ability to create liens, secure certain indebtedness and merge with or sell substantially all of our assets to another entity. The debentures are convertible into shares of common stock only if (1) the average sale price of our common stock is at least…S16-9 On January 6, 2023, Ling Corp. paid $5,000,000 for its 40 percent investment in True World Inc. Assume that on December 31 that same year, True World earned net income of $1,800,000 and paid cash dividends of $800,000. What method should Ling Corp. use to account for the investment in True World Inc.? Give your reason. Ignore any brokerage commission expenses. Post to the Investment in True World Inc. Common Shares T- account. What is its balance after all the transactions are posted? Journalize these three transactions on the books of Ling Corp. Include an explanation for each entry.
- Live Large Inc. had the following transactions involving non-strategic Investments during 2023. 2023 Apr. 1 Paid $118,050 to buy a 90-day term deposit, $118,000 principal amount, 6.5%, dated April 1. There was a $50 transaction fee included in the above-noted payment amount. 12 Purchased 4,800 common shares of Blue Balloon Ltd. at $22.25. There was a $50 transaction fee included in the above-noted payment amount. June 9 Purchased 3,600 common shares of Purple Car Corp. at $51.00. There was a $50 transaction fee included in the above-noted payment amount. 20 Purchased 1,600 common shares of Yellow Tech Ltd. at $15.75. There was a $50 transaction fee included in the above-noted payment acount. July 1 Purchased for $85,912 a 8.5%, $83,000 Space Explore Inc. bond that matures in eight years when the market interest rate was 7.9%. There was a $50 transaction fee included in the above-noted payment amount. Interest is paid semiannually beginning December 31, 2023. Live Large Inc. plans to…1. On January 1, 202X, Yanna Corporation acquired the net assets of Migo Corporation by issuing 100,000 shares with par and market values of P22 and P3,250,000, respectively. Moreover, it agreed to pay an additional P300,000 on January 1, 202Z if the average income in 202x and 202Y exceeds P160,000 per year. The expected value of the additional payment is equal to a 52% probability of achieving the target average income. The fair value of the assets and liabilities of Jandra Company as of the acquisition date is given below: Cash Marketable Securities Inventory Land P220,000 330,000 650,000 460,000 950,000 500,000 225,000 P3,335,000 Building Equipment Unrecognized Receivables Total Current Liabilities Bonds Payable Premium on Bonds Payable Total Liabilities P275,000 670,000 60,000 P1,005,000 Required: a. Determine the amount of goodwill or gain on bargain purchases that should be recognized at the acquisition date. b. Give the adjusting entry to be made by Yanna Corporation if it…For numbers 1 to 11, identify how much to add or deduct from the Investment in Associate account of ABC based on the following transactions or events: 1. Dec. 1, 2020 ‐ Bought 3,000 X Corp. shares at P200 per share. The total ordinary shares outstanding of X is 100,000 and each had a par value of P150. 2. Jan. 1, 2021 ‐ Bought an additional 15,000 shares of X Corp. for a total price of P3,800,000. The original shares are valued at P250 each. On the same date, ABC started providing essential technical information to X and that both corporations have an interchange of managerial personnel. Significant influence is established. There were no changes in the ordinary shares outstanding. 3. Net income reported for the year by the associate was P2,500,000. 4. Dividends declared by X is P2,000,000. It has 90,000 6%, P100‐par value preference shares outstanding which are cumulative and participating. No dividends were declared in the previous year. 5. As of Jan. 1, 2021, the fair value of the…
- usiness FinanceQ&A LibraryPlease provide solutions and explanation. Thank you so much. 1. Use the following information for the next three questions: On January 1, 20x1, ABC Co. acquired 10%, ₱1,000,000 bonds for ₱827,135. The bonds mature on December 31, 20x3 and pay annual interest every December 31. ABC Co. incurred transaction costs ₱80,000 on the acquisition. The effective interest rate adjusted for the effect of the transaction costs is 14%. The bonds are to be held under a “hold to collect and sell” business model. Information on fair values is as follows: December 31, 20x1…………………………….98 December 31, 20x2……………………………102 December 31, 20x3……………………………100 How much is the carrying amount of the investment on December 31, 20x1? a. 935,134 b. 1,002,000 c. 980,000 d. 965,443 How much is the unrealized gain (loss) recognized in other comprehensive income on December 31, 20x1? a. 45,866 b. (45,866) c. (37,899) d. 0 How much is the interest income recognized in 20x2? a.…The investments of Harlon Enterprises included the following cost and fair value amounts: ($ in millions) Fair Value, Dec. 31 Securities Available-for-Sale 2016 Cost 2017 A Corporation shares B Corporation bonds C Corporation shares $ 20 $14 na $ 37 35 35 15 14 na D Industries shares 50 46 45 Totals $115 $95 $101 Harlon Enterprises sold its holdings of A Corporation shares on June 1, 2017, for $15 million. On September 12, 2017, it purchased the C Corporation shares. Required: 1. What is the effect of the sale of the A Corporation shares and the purchase of the C Corporation shares on Harlon's 2017 pretax earnings? 2. At what amount should Harlon's securities available-for-sale portfolio be reported in its 2017 balance sheet? What adjusting entry is needed to accomplish this? What is the effect of the adjustment on Harlon's 2017 pre- tax earnings?I REALLY NEED HELP ON THIS, PLEASE DON'T REJECT Ed Company acquired the assets and assumed the liabilities of Sheeran Inc. on June 30, 2022. The consideration transferred by the acquirer were as follows: Cash amounting to P2,000,000.Issued 10,000 ordinary shares at P10 par with a market price of P15.Issued 5 year interest bearing bonds payable with a face value of P3,000,000 with a nominal rate of 10% and effective interest of 12%. (use two decimal places for the present value factor) Acquisition related costs incurred were as follows: Legal fees amounting to P120,000, 70% of which is not yet paid.Share issue costs paid amounted to P15,000.Bond Issue costs paid amounting to P120,000. The Balance Sheet of the two entities before acquisition were as follows: Ed Company Sheeran Inc. Total Assets 16,500,000 5,235,000 Total Liabilities 2,500,000 500,000 Ordinary Shares 5,000,000 1,250,000 Share premium 1,500,000 750,000 Retained…