1 Exhibit 11.1 TRANSITION SYSTEMS, INC. COMPUTATION OF PRO FORMA EARNINGS PER SHARE March 30, 1996 March 25, 1995 -------------- -------------- For the three month period ended: Net income ....................................... $ (910,000) $ 1,112,000 Pro forma common stock outstanding (1) ........... 10,087,776 10,087,776 Cheap stock (2) .................................. 3,500,425 3,500,425 Warrants ......................................... 297,928 297,928 Pro forma weighted average number of common shares and common equivalent shares outstanding ....... 13,886,129 13,886,129 Pro forma net income per share ................... $ (0.07) $ 0.08 For the six months ended: Net income ....................................... $ 269,000 $ 1,404,000 Pro forma common stock outstanding (1) ........... 10,087,776 10,087,776 Cheap stock (2) .................................. 3,500,425 3,500,425 Warrants ......................................... 297,928 297,928 Pro forma weighted average number of common shares and common equivalent shares outstanding ....... 13,886,129 13,886,129 Pro forma net income per share ................... $ 0.02 $ 0.10 <FN> (1) Gives effect to the Recapitalization. See "Certain Transactions - Recapitalization." See notes 2 and 13 of Notes to Consolidated Financial Statements included in the Company's Registration Statement on Form S-1, File No. 333-01758, as declared effective by the Securities and Exchange Commission on April 17, 1996. (2) Calculated in accordance with the Securities and Exchange Commission Staff Accounting Bulletin No. 83 ("SAB 83") except that common stock issuable upon conversion of the preferred stock is included in pro forma common stock outstanding and excluded from cheap stock.