Question
Rio Inc. had 423,500 shares of common stock outstanding throughout the year. Net income for the year was $1,218,000. Rio Inc. had 3 potentially dilutive
Rio Inc. had 423,500 shares of common stock outstanding throughout the year. Net income for the year was $1,218,000. Rio Inc. had 3 potentially dilutive securities.
| Potentially Dilutive Security | Numerator Effect | Denominator Effect |
|---|---|---|
| 1 | $61,600 | 18,150 shares |
| 2 | 15,400 | 30,800 shares |
| 3 | 0 | 6,600 shares |
a. Compute basic earnings per share.
b. Compute diluted earnings per share.
Step by Step Solution
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Step: 1
To compute the basic and diluted earnings per share EPS for Rio Inc we need to consider the net inco...
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Linear Algebra with Applications
Authors: Steven J. Leon
7th edition
131857851, 978-0131857858
