Four independent situations follow:

Required: 

a. For each of the four independent situations, compute basic earnings per share and diluted earnings per share from each of continuing operations, discontinued operations, and operations. 

b. Summarize IFRS requirements with respect to determining diluted EPS when there is a loss from continuing operations. 

c. Summarize IFRS requirements with respect to determining diluted EPS when there is a net loss; however, earnings from continuing operations is positive. 

d. Describe the presentation requirement for EPS including permissible alternatives.

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Earnings (loss) from continuing operations Earnings (loss) from discontinued operations Net income (loss) Weighted average number of ordinary shares outstanding Preference shares Potential ordinary shares Situation 1 $500,000 100,000 $600,000 100,000 None outstanding 10,000 options on ordinary shares- exercise price $20, average market price $25 Situation 2 $(500,000) 100,000 $(400,000) 100,000 None outstanding 10,000 options on ordinary shares- exercise price $20, average market price $25 Situation 3 $(50,000) 100,000 $ 50,000 100,000 None outstanding 10,000 options on ordinary shares- exercise price $20, average market price $25 Situation 4 $ 50,000 (100,000) $ (50,000) 100,000 None outstanding 10,000 options on ordinary shares- exercise price $20, average market price $25