Common and preferred stock shareholders

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ABC Corporation had 100,000 shares of common stock outstanding on January 1, 2010. ABC also had 10,000 shares of 6%, $100 par value convertible preferred stock outstanding throughout 2010. Each share of preferred stock is convertible into three shares of common. Additionally, ABC had $500,000 of 8% convertible bonds outstanding throughout the year. Each $1,000 bond is convertible into 30 shares of common stock. ABC reported earnings before interest and taxes $600,000 for 2010 and was subject to a 40% tax rate. ABC paid dividends to all common and preferred stock shareholders during the year. Calculate ABC's basic earnings per share for 2010. Show your work.

Reference no: EM13134090

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