Bonita Corporation earned $405,000 during a period when it had an average of 100,000 shares of common stock outstanding. The common stock sold at an average market price of $15 per share during the period. Also outstanding were 15,900 warrants that could be exercised to purchase one share of common stock for $10 for each warrant exercised. Compute basic earnings per share Compute diluted earnings per share.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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Bonita Corporation earned $405,000 during a period when it had an average of 100,000 shares of common stock outstanding. The common stock sold at an average market price of $15 per share during the period. Also outstanding were 15,900 warrants that could be exercised to purchase one share of common stock for $10 for each warrant exercised.

  1. Compute basic earnings per share
  2. Compute diluted earnings per share.
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