Exam 17: Earnings Per Share and Retained Earnings

The potential dilutive effect of the exercise of stock options or warrants will affect which of the following when calculating diluted earnings per share?

Smock Corporation had 30, 000 shares of common stock outstanding during the year.In addition, there were compensatory stock options to purchase 3, 000 shares of common stock at $20 a share outstanding the entire year.The average market price for the common stock during the year was $36 a share.The unrecognized compensation cost (net of tax)relating to these options was $4 a share.The denominator to compute the diluted earnings per share is

Corporations with complex capital structures are required to report both the basic and diluted earnings per share amounts.In order to compute the diluted earnings per share, potential common shares must be considered. Required: List the sequence of steps necessary to include potential common shares in the diluted earnings per share calculation.

Warren, Inc.determined the following information concerning its common stock during 2010: January 1 40,000 shares outstanding April 1 Issued a 10\% stock dividend July 1 Issued an additional 1,900 share October 1 Issued a 2-for-1 stock split December 1 Reacquired 3,000 shares Required: What should Warren, Inc.use as the denominator for its basic earnings per share calculation for 2010?

A simple capital structure consists of

Which of the following stockholders' equity disclosures are required under both GAAP and IFRS?