I Am Free Corp. has three stock option plans outstanding on December 31, 2021. They provide the holders with the following entitlements: 

1. Stock option A—The holders may purchase 30,000 ordinary shares at any time on or before December 31, 2025, for $20 each. 

2. Stock option B—The holders may purchase 6,000 ordinary shares at any time on or before December 31, 2022, for $22 each. From January 1, 2023, to December 31, 2025, the holders may purchase 10,000 ordinary shares for $25 each. 

3. Stock option C—The holders may purchase 5,000 ordinary shares at any time on or before December 31, 2023, for $26 each. 

The average price of ordinary shares in 2021 was $24. I Am Free’s basic EPS from continuing operations for the year was $1.22. 

Required:

a. Which of the stock options are dilutive and which are antidilutive in 2021? What is the rule in this respect? 

b. Assuming that all three option plans have been in place the entire year, for each plan determine the incremental number of shares, if any, that need to be considered for diluted EPS purposes. 

c. Assume that stock option A was issued on April 1, 2021. Does this change your answer to part (b)? If so, what is the revised number of incremental shares for option A that need to be considered for diluted EPS purposes?