Hihotech Company reported net income of 2.3 million for the year ended 20XX and had a weighted average of 800,000 common shares outstanding. At the beginning of the fiscal year, the company has option of 30,000 with an average exercise price 35. No potentially dilutive securities are outstanding. Over the fiscal year, the company’s market price averaged 55 per share.Required: Calculate company’s basic and diluted EPS under IFRS and US GAAP It has been argued that both methods will yield the same results but the underlying justification employed by both methods is different. Explain these justifications.

Hihotech Company reported net income of 2.3 million for the year ended 20XX and had a weighted average of 800,000 common shares outstanding. At the beginning of the fiscal year, the company has option...

Hihotech Company reported net income of 2.3 million for the year ended 20XX and had a weighted average of 800,000 common shares outstanding. At the beginning of the fiscal year, the company has option of 30,000 with an average exercise price 35. No potentially dilutive securities are outstanding. Over the fiscal year, the company’s market price averaged 55 per share.

Required:

It has been argued that both methods will yield the same results but the underlying justification employed by both methods is different. Explain these justifications.

Jun 09, 2022