Glendale Enterprises had 200,000 shares of common stock issued and outstanding at December 31, 2010. On July 1, 2011, Glendale issued a 10 percent stock dividend. Unexercised stock options to purchase 40,000 shares of common stock (adjusted for the 2011 stock dividend) at $20 per share were outstanding at the beginning and end of 2011. The market price of Glendale's common stock (which was not affected by the stock dividend) was $25 per share during 2011. Net income for the year ended December 31, 2011, was $1,100,000. What should be Glendale's 2011 diluted earnings per common share, rounded to the nearest penny?
A) $4.23
B) $4.82
C) $5.00
D) $5.05

Question

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The Answer of Glendale Enterprises had 200,000 shares of common stock issued and outstanding at December 31, 2010. On July 1, 2011, Glendale issued a 10 percent stock dividend. Unexercised stock options to purchase 40,000 shares of common stock (adjusted for the 2011 stock dividend) at $20 per share were outstanding at the beginning and end of 2011. The market price of Glendale's common stock (which was not affected by the stock dividend) was $25 per share during 2011. Net income for the year ended December 31, 2011, was $1,100,000. What should be Glendale's 2011 diluted earnings per common share, rounded to the nearest penny?
A) $4.23
B) $4.82
C) $5.00
D) $5.05

Glendale Enterprises Had 200,000 Shares of Common Stock Issued and Outstanding