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12 October, 04:42

Fully vested incentive stock options exercisable at $46 per share to obtain 20,000 shares of common stock were outstanding during a period when the average market price of the common stock was $50 and the ending market price was $50. What will be the net increase in the weighted-average number of shares outstanding due to the assumed exercise of these options when calculating diluted earnings per share?

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  1. 12 October, 04:47
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    1,600

    Explanation:

    Cost of incentive stock options 20,000*46=$920,000

    Shares at exercise price $920,000/50=18,400

    Shares option difference 20,000-18,400=1,600
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