Determine the Basic and Diluted Earnings Per Share for Company X. All necessary Information is listed below. Show your calculations. 2. In 10
Company X information for Diluted Shares calculations for period 201X: Earnings for Year 201X - $20 million Average Basic shares outstanding for Company X in 201X - 10 million Average Stock Price for year 201X - $6.00 Warrants to purchase common shares: - Warrants A to purchase 2 million shares ex @ $2.00 - Warrants B to purchase 3 million shares ex @ $5.00.
Assume the A and B Warrants are the only additional securities outstanding (besides the basic shares) for Company X in 201X.
0 words, or fewer, explain why investors should be more interested in the the Diluted EPS number than the Basic EPS number.