Ignatius Corporation Had 7 Million Shares of Common Stock Outstanding

Short Answer

Ignatius Corporation had 7 million shares of common stock outstanding during the current calendar year.It issued ten thousand $1,000,convertible bonds on January 1.Each bond is convertible into 50 shares of common stock.The bonds were issued at face amount and pay interest quarterly at an annual rate of 10%.On June 30,Ignatius issued 100,000 shares of $100 par 6% cumulative preferred stock.Dividends are declared and paid semiannually.Ignatius has an effective tax rate of 40%.Ignatius would report the following EPS data (rounded)on its net income of $20 million: