单选题 An analyst gathered the following data about Bands Forever: In 2007 Bands Forever reported net income of $ 22500 and had 3000 shares of stock outstanding for the entire year.
The company also had 1200 shares of 10% , $ 50 par value preferred stock outstanding for the entire year.
The company had 50,10% coupon, $1000 par value bonds convertible into 50 shares of stock each, also outstanding for the entire year.
The average market price of the stock for 2007 was $ 20. The tax rate is 40%.
The convertible bonds are:

A. dilutive, with diluted earnings per share(EPS) of $ 2.45 versus basic EPS of $ 0.50.
B. dilutive, with diluted EPS of $ 3.55 versus basic EPS of $ 5.50.
C. antidilutive, with diluted EPS of $ 8.50 versus basic EPS of $ 7.50.

【正确答案】 B

【答案解析】Basic EPS is (net income-preferred dividends ) /number of shares outstanding = [ $ 22500 (0.10×$ 50×1200)]/3000 = $5.50. Diluted EPS with the convertible bonds is the NI minus preferred dividends plus the interest expense the firm would not incur if the bonds were converted divided by the shares outstanding plus the number of shares to which the bonds would convert. Realize that the bond interest expense would have been before tax so they would not save the full $ 5000, just the $ 3000 or $ 5000 (1-0.40)= $ 3000. Diluted EPS with CV bonds = [ $ 22500 -6000 + (0.1×1000×50)×(1-0.4) ]/3000 + (50 bonds×50 shares) Diluted EPS = $19500/5500 shares = $ 3.55.