Ozarka Products reported $9,500,000 in net income for the current year. The company had $5,000,000 of 7% cumulative, preferred stock outstanding all year, along with, $10,000,000 of 6% bonds. Each bond had 4 detachable stock warrants and each warrant allowed the warrant holders to buy a share of stock for $60. The average share price for the year was $80. Common shares outstanding at the
beginning of the year was 4,000,000, but on June 15, the company declared a a 10% stock dividend. Compute both basic and diluted EPS when the tax rate is 40%.
Instructions: Write the EPS formula. Show all computations used in your solution.
What will be an ideal response?
Answer:
Basic EPS = 
Business
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