The financial statements of P&G are presented in Appendix 5B. The company’s complete annual report, including the notes to the financial statements, can be accessed at the book’s companion website, www.wiley.com/college/kieso.

Instructions
Refer to P&G’s financial statements and accompanying notes to answer the following questions.

  (a) Under P&G’s stock-based compensation plan, stock options are granted annually to key managers and directors.

  (1) How many options were granted during 2011 under the plan?
  (2) How many options were exercisable at June 30, 2011?
  (3) How many options were exercised in 2011, and what was the average price of those exercised?
  (4) How many years from the grant date do the options expire?
  (5) To what accounts are the proceeds from these option exercises credited?
  (6) What was the number of outstanding options at June 30, 2011, and at what average exercise price?

  (b) What number of diluted weighted-average common shares outstanding was used by P&G in computing earnings per share for 2011, 2010, and 2009? What was P&G’s diluted earnings per share in 2011, 2010, and 2009?
  (c) What other stock-based compensation plans does P&G have?