NOTES TO FINANCIAL STATEMENTS
NOTE 16 EARNINGS PER SHARE
Basic earnings per share is computed on the basis of the weighted average number of common shares outstanding. Diluted earnings per share is computed on the basis of the weighted average number of common shares outstanding plus the effect of outstanding preferred shares using the if-converted method, outstanding put warrants using the reverse treasury stock method, and outstanding stock options using the treasury stock method.
The components of basic and diluted earnings per share were as follows:
In millions, except per share amounts |
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Year Ended June 30 |
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2000 |
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2001 |
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2002 |
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Income before accounting change |
$ |
9,421 |
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$ |
7,721 |
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$ |
7,829 |
Preferred stock dividends |
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13 |
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Net income available for common shareholders |
$ |
9,408 |
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$ |
7,721 |
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$ |
7,829 |
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Weighted average outstanding shares of common stock |
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5,189 |
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5,341 |
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5,406 |
Dilutive effect of: |
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Put warrants |
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2 |
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21 |
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Preferred stock |
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7 |
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Employee stock options |
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338 |
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212 |
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147 |
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Common stock and common stock equivalents |
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5,536 |
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5,574 |
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5,553 |
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Earnings per share before accounting change: |
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Basic |
$ |
1.81 |
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$ |
1.45 |
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$ |
1.45 |
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Diluted |
$ |
1.70 |
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$ |
1.38 |
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$ |
1.41 |
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For the years ended June 30, 2000, 2001 and 2002, 45 million, 351 million, and 373 million shares attributable to outstanding stock options were excluded from the calculation of diluted earnings per share because the effect was antidilutive.
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