Calculating EPS with Restricted Stock

StarStruck Inc. granted 2,750 shares of restricted stock (common shares, $1 par) to its president on January 1, 2020, when the stock was trading at $40 per share. Net income for 2020 was $1,400,000 and 220,000 shares were outstanding throughout 2020. On average, the fair value of common shares in 2020 was $40 per share. The restricted shares vest after 3 years if the president remains with the company.

Required

a. Compute basic EPS.

b. Compute diluted EPS.

• Note: Round weighted average common shares outstanding to the nearest whole number.
• Note: Round earnings per share amount to two decimal places.

	Net Income Available to Common Stockholders	Weighted Avg. Common Shares Outstanding	Per Share
Basic EPS	Answer	Answer	Answer
Diluted EPS	Answer	Answer	Answer