What the number of shares to be used in computing

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Reference no: EM132807724

Problem 1: In applying the treasury stock method of computing diluted earnings per share, when is it appropriate to use the average market price of common stock during the year as the assumed repurchase price?

a. Always

b. Never

c. When the average market price is higher than the exercise price

d. When the average market price is lower than the exercise price

Problem 2: On January 1, 20x6, Hage Corporation granted options to purchase 9,000 of its ordinary shares at ?7 each. The market price was ?10.50 per ordinary share on March 31, 20x6, and averaged ?9 per share during the quarter then ended. There was no change in the 50,000 shares of outstanding common stock during the quarter ended March 31, 20x6. Profit for the quarter was ?8,268. The number of shares to be used in computing diluted earnings per share for the quarter is

a. 59,000

b. 50,000

c. 53,000

d. 52,000

Reference no: EM132807724

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