On December 31, 2003, Masters Inc. had outstanding 180,000 shares of common stock. Net income for 2003 was ₱285,000. Outstanding options (granted July 1, 2003) to purchase 15,000 shares of common stock at ₱20 per share had not been exercised by December 31, 2003. During 2003, market prices for the common stock were: July 1, 2003- ₱18 per share December 31, 2003- ₱32 per share Average market- ₱25 per share REQUIREMENTS: (1) Compute the BASIC EARNINGS PER SHARE for 2003. (2) Compute the DILUTED EARNINGS PER SHARE for 2003.
On December 31, 2003, Masters Inc. had outstanding 180,000 shares of common stock. Net income for 2003 was ₱285,000. Outstanding options (granted July 1, 2003) to purchase 15,000 shares of common stock at ₱20 per share had not been exercised by December 31, 2003. During 2003, market prices for the common stock were: July 1, 2003- ₱18 per share December 31, 2003- ₱32 per share Average market- ₱25 per share REQUIREMENTS: (1) Compute the BASIC EARNINGS PER SHARE for 2003. (2) Compute the DILUTED EARNINGS PER SHARE for 2003.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On December 31, 2003, Masters Inc. had outstanding 180,000 shares of common stock. Net income for 2003 was ₱285,000. Outstanding options (granted July 1, 2003) to purchase 15,000 shares of common stock at ₱20 per share had not been exercised by December 31, 2003. During 2003, market prices for the common stock were:
July 1, 2003- ₱18 per share
December 31, 2003- ₱32 per share
Average market- ₱25 per share
REQUIREMENTS:
(1) Compute the BASIC EARNINGS PER SHARE for 2003.
(2) Compute the DILUTED EARNINGS PER SHARE for 2003.
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