Major Corporation had 50,000 shares of common stock outstanding during 2016 with the following characteristics:
The company also has compensatory share options to purchase 5,000 shares of common stock at $40 a share during the year. The unrecognized compensation cost net of tax) related to these share options is $5 per share. Net income for the year was $60,600.
Required:
Compute the basic and diluted earnings per share for Major Corporation.

Question

Major Corporation had 50,000 shares of common stock outstanding during 2016 with the following characteristics:  
The company also has compensatory share options to purchase 5,000 shares of common stock at $40 a share during the year. The unrecognized compensation cost net of tax) related to these share options is $5 per share. Net income for the year was $60,600.
Required:
Compute the basic and diluted earnings per share for Major Corporation.

Quizplus · Accepted Answer

The Answer of Major Corporation had 50,000 shares of common stock outstanding during 2016 with the following characteristics:  
The company also has compensatory share options to purchase 5,000 shares of common stock at $40 a share during the year. The unrecognized compensation cost net of tax) related to these share options is $5 per share. Net income for the year was $60,600.
Required:
Compute the basic and diluted earnings per share for Major Corporation.

Major Corporation Had 50,000 Shares of Common Stock Outstanding During