What is weighted average number of ordinary shares

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Reference no: EM132901225

At January 1, 2021, the Strawberry Company had 400,000 of P50 par ordinary shares outstanding. The company had issued share options to its management personnel permitting them to acquire 10,000 ordinary shares at P12 per share. At the time of the issuance, an ordinary share was selling for P10. The market price of ordinary share was P12 on July 1, 2021, and the average price for 2021 was P16.

Profit for 2021 was P4,965,000. Terms of the option make them currently exercisable. On October 1, options to acquire 5,000 shares were exercised. The other options are still outstanding at December 31, 2021.

Problem 1: What is the weighted average number of ordinary shares outstanding for basic EPS calculation?

Problem 2:  What is the weighted average number of ordinary shares outstanding for diluted EPS calculation?

Problem 3: What if in the above, no share options were actually exercised, what is the weighted average number of ordinary shares for basic EPS and diluted EPS calculation, respectively?

Problem 3: What if in the above, options to acquire 10,000 shares were exercised on October 1, 2021, what is the weighted average number of ordinary shares outstanding for basic EPS and diluted EPS calculation, respectively?

Reference no: EM132901225

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