The following information was taken from the books and records of LWAK ltd:
1. Net income sh. 280,000
2. Capital structure:
a. Convertible 6% bonds. Each of the 300, sh.1, 000 bonds is convertible
Into 50 ordinary shares at the present date and for the next
10 years. 300,000
b. sh.10 par, 200,000 ordinary shares issued and outstanding
during the entire year. 2,000,000
c. Share warrants outstanding to buy 16,000 ordinary shares
at sh.20 per share.
3. Other information:
a. Bonds converted during the year None
b. Income tax rate 30%
c. Convertible debt was outstanding the entire year
d. Average market price per share of common stock during the year sh.32
e. Warrants were outstanding the entire year
f. Warrants exercised during the year None
Required
Compute basic and diluted earnings per share.
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