INTERNATIONAL PAPER CO /NEW/ | 2013 | FY | 3


Basic earnings per share is computed by dividing earnings by the weighted average number of common shares outstanding. Diluted earnings per share is computed assuming that all potentially dilutive securities, including “in-the-money” stock options, were converted into common shares.

A reconciliation of the amounts included in the computation of basic earnings (loss) per share from continuing operations, and diluted earnings (loss) per share from continuing operations is as follows: 
In millions, except per share amounts
2013

 
2012

 
2011

Earnings (loss) from continuing operations
$
1,350

 
$
749

 
$
1,273

Effect of dilutive securities (a)
—

 
—

 
—

Earnings (loss) from continuing operations –assuming dilution
$
1,350

 
$
749

 
$
1,273

Average common shares outstanding
443.3

 
435.2

 
432.2

Effect of dilutive securities (a):
 
 
 
 
 
Restricted performance share plan
4.5

 
5.0

 
4.8

Stock options (b)
0.3

 
—

 
—

Average common shares outstanding  – assuming dilution
448.1

 
440.2

 
437.0

Basic earnings (loss) per share from continuing operations
$
3.05

 
$
1.72

 
$
2.95

Diluted earnings (loss) per share from continuing operations
$
3.01

 
$
1.70

 
$
2.92


(a)
Securities are not included in the table in periods when antidilutive.
(b)
Options to purchase 0.0 million, 9.1 million and 15.6 million shares for the years ended December 31,2013, 2012 and 2011, respectively, were not included in the computation of diluted common shares outstanding because their exercise price exceeded the average market price of the Company’s common stock for each respective reporting date.

us-gaap:EarningsPerShareTextBlock