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Amy Dyken, controller at Fitzgerald Pharmaceutical Industries, a public company, is currently preparing the calculation for basic and diluted earnings per share and the related disclosure for Fitzgeralds financial statements. Below is selected financial information for the fiscal year ended June 30, 2012.
FITZGERALD PHARMACEUTICAL INDUSTRIES
SELECTED BALANCE SHEET
JUNE 30, 2012
Notes payable, 9%
8% convertible bonds payable
9% bonds payable
Total long-term debt
Preferred stock, 5% cumulative, $54 par value,
109,400 shares authorized, 27,350 shares issued and outstanding
Common stock, $1 par, 10,050,000 shares authorized,
1,005,000 shares issued and outstanding
Additional paid-in capital
Total shareholders equity
The following transactions have also occurred at Fitzgerald.
Options were granted on July 1, 2011, to purchase 203,800 shares at $17 per share. Although no options were exercised during fiscal year 2012, the average price per common share during fiscal year 2012 was $20 per share.
Each bond was issued at face value. The 8% convertible bonds will convert into common stock at 54 shares per $1,000 bond. The bonds are exercisable after 5 years and were issued in fiscal year 2011.
The preferred stock was issued in 2011.
There are no preferred dividends in arrears; however, preferred dividends were not declared in fiscal year 2012.
The 1,005,000 shares of common stock were outstanding for the entire 2012 fiscal year.
Net income for fiscal year 2012 was $1,581,000, and the average income tax rate is 40%.
For the fiscal year ended June 30, 2012, calculate the following for Fitzgerald Pharmaceutical Industries.(Round the answers to 2 decimal places, e.g. $2.45.)
(a)Basic earnings per share.
Basic earnings per share
(b) Diluted earnings per share.
Diluted earnings per share
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