On December 31, 2015, Berclair Inc. had 442 million shares ofcommon stock and 5 million shares of 9%, $100 par value cumulativepreferred stock issued and outstanding. Net income for the yearended December 31, 2016, was $1,050 million.
Also outstanding at December 31 were incentive stock optionsgranted to executives. The options were exercisable for 30 millioncommon shares at an exercise price of $56 per share. During 2016,the market price of the common shares averaged $70 per share.
Required: Compute Berclair's basic anddiluted earnings per share for the year endedDecember 31, 2016.
