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Keys Company had net income of $100,000 for the year ended December 31, 2005. The company had 10,000 shares of common stock outstanding at all times during the year. On January 1, 2005, the company issued 10,000 stock options. Each option can be used to purchase one share of common stock at $10 per share. The average market price of the common stock during 2005 was $20 per share, and the closing price at December 31, 2005, was $25 per share.

1. Calculate the required EPS figures for 2005.
2. Calculate the required EPS figures for 2005 assuming that the options were issued on April 1, 2005.
3. Calculate the required EPS figures for 2005, assuming that the average market price of the common stock was $8 per share and the closing price was $9.

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Accounting Basics, Accounting

Category:- Accounting Basics
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