The following information is relevant to the computation of Pharm Co.'s earnings per share to be disclosed on Pharm's income statement for the year ending December 31: Net income for Year 2 is $800,000. $4,000,000 face value 10-year convertible bonds outstanding on January 1. The bonds were issued four years ago at a premium that is being amortized in the amount of $28,000 per year. The stated rate of interest on the bonds is 8%, and the bonds were issued to yield 7%. Each $1,000 bond is convertible into 70 shares of Pharm's common stock. Preferred stock, $10 par, 4% cumulative, 15,000 shares issued and outstanding. No dividend is declared for Year 2. Pharm's corporate income tax rate is 20%. What amount should be used as the numerator in the fraction used to compute Pharm's diluted earnings per share assuming that the bonds are dilutive securities

The gilbert instrument corporation is considering replacing the wood steamer it currently uses to shape guitar sides. the steamer has 6 years of remaining life. if kept, the steamer will have depreciaiton expenses of $650 for five years and $325 for the sixthyear. its current book value is $3,575, and it can be sold on an internet auction site for$4,150 at this time. if the old steamer is not replaced, it can be sold for $800 at the endof its useful life. gilbert is considering purchasing the side steamer 3000, a higher-end steamer, whichcosts $12,000 and has an estimated useful life of 6 years with an estimated salvage value of$1,500. this steamer falls into the macrs 5-year class, so the applicable depreciationrates are 20.00%, 32.00%, 19.20%, 11.52%, 11.52%, and 5.76%. the new steamer is fasterand allows for an output expansion, so sales would rise by $2,000 per year; the newmachine's much greater efficiency would reduce operating expenses by $1,900 per year. to support the greater sales, the new machine would require that inventories increase by$2,900, but accounts payable would simultaneously increase by $700. gilbert's marginalfederal-plus-state tax rate is 40%, and its wacc is 15%.a. should it replace the old steamer? b. npv of replace = $2,083.51