Ayayai Company’s net income for 2020 is $52,900. The only potentially dilutive securities outstanding were 1,040 options issued during 2019, each exercisable for one share at $6. None has been exercised, and 10,900 shares of common were outstanding during 2020. The average market price of Ayayai’s stock during 2020 was $20. (b) Assume the same facts as those assumed for part (a), except that the 1,040 options were issued on October 1, 2020 (rather than in 2019). The average market price during the last 3 months of 2020 was $20. Answer (b)
Ayayai Company’s net income for 2020 is $52,900. The only potentially dilutive securities outstanding were 1,040 options issued during 2019, each exercisable for one share at $6. None has been exercised, and 10,900 shares of common were outstanding during 2020. The average market price of Ayayai’s stock during 2020 was $20. (b) Assume the same facts as those assumed for part (a), except that the 1,040 options were issued on October 1, 2020 (rather than in 2019). The average market price during the last 3 months of 2020 was $20. Answer (b)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ayayai Company’s net income for 2020 is $52,900. The only potentially dilutive securities outstanding were 1,040 options issued during 2019, each exercisable for one share at $6. None has been exercised, and 10,900 shares of common were outstanding during 2020. The average market price of Ayayai’s stock during 2020 was $20.
(b) Assume the same facts as those assumed for part (a), except that the 1,040 options were issued on October 1, 2020 (rather than in 2019). The average market price during the last 3 months of 2020 was $20.
Answer (b)
Diluted Earnings Per Share = ?
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