Exhibit 11.1 THE HOME DEPOT, INC. AND SUBSIDIARIES Computation of Earnings Per Common and Common Equivalent Share (In Thousands, Except Per Share Data) Three Months Ended Six Months Ended Primary August 3, July 28, August 3, July 28, 1997 1996 1997 1996 Net Earnings Applicable to Common and Common Equivalent Shares $ 357,878 $ 270,174 $ 616,712 $ 465,193 Tax Effected Interest Expense, Net of Interest Capitalized, Attributable to 3.25% Convertible Subordinated Notes 5,845 ------ 11,686 ---- Shares: Weighted Average Number of Common and Common Equivalent Shares Assuming Average Market Price for Period 737,928 723,669 734,469 722,076 Additional Shares from assumed Conversion of 3.25% Convertible Subordinated Notes 23,957 ------ 23,957 ------ 761,885 723,669 758,426 722,076 Primary Earnings per Common and common Equivalent Share $ .477 $ .373 $ .829 $ .644 Fully Diluted Net Earnings Applicable to Common and Common Equivalent Shares $ 357,878 $ 270,174 $ 616,712 $ 465,193 Tax Effected Interest Expense, Net of Interest Capitalized, attributable to 3.25% Convertible Subordinated Notes $ 5,845 $ ------- $ 11,686 $ ------ $ 363,723 $ 270,174 $ 628,398 $ 465,193 Shares: Weighted Average Number of Common and Common Equivalent Shares at Higher of Ending or Average Market Price 739,557 723,669 737,379 722,437 Additional Shares From 3.25% Convertible Subordinated Notes 23,957 ----- 23,957 ------ 763,514 723,669 761,336 722,437 Fully Diluted Earnings per Common and Common Equivalent Shares $ .476 $ .373 $ .825 $ .644 (1) Common equivalent shares represent shares granted under the Company's employee stock purchase plan and stock option plans for the three and six month periods ended August 3, 1997 and July 28, 1996. All periods have been adjusted to reflect the three-for-two stock split in July 1997. Exhibit 11.1 (continued) THE HOME DEPOT, INC. AND SUBSIDIARIES Computation of Earnings Per Common and Common Equivalent Share (2) The Company's 3.25% Convertible Subordinated Notes issued on October 2, 1996, are common stock equivalents. For the three and six months ended August 3, 1997, the Notes were dilutive and, accordingly, were assumed to be converted at the beginning of the accounting period for purposes of calculating earnings per share. (3) For the three month period ended July 28, 1996, the ending price of the stock was lower than the average price and therefore the average price of the stock is used in calculating fully dilutive earnings per share.