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                                                                    Exhibit 11


                                CLAYTON HOMES
                      COMPUTATION OF EARNINGS PER SHARE


                 Net income per share on a primary basis is computed on the 
                 weighted average number of shares outstanding during the 
                 quarter after giving effect to the equivalent shares which 
                 are issuable upon the exercise of stock options determined by 
                 the treasury stock method.  Fully diluted earnings per share is
                 computed assuming conversion of convertible subordinated 
                 debentures.  The calculations of primary and fully diluted 
                 earnings per share follow:

                                                    Three Months Ended
                                                       September 30,
(in thousands except per share data)            
                                                  1994              1993 
                                                -------           -------
Reported income before accounting               
  change (primary)                              $18,225           $14,828
Add: Convertible debentures interest            
  expense, net of tax                                 0               481
                                                -------           -------
Income before accounting change                 
  (fully diluted)                               $18,225           $15,309
                                                =======           =======
                                                
Reported net income (primary)                   $18,225           $17,828
Add: Convertible debentures                     
  interest expense, net of tax                        0               481
                                                -------           -------
Net income (fully diluted)                      $18,225           $18,309
                                                =======           =======
                                                
Weighted average shares                         
  outstanding (primary)                          60,846            57,335
Shares issuable upon                            
  conversion of all debentures                        0             3,986
                                                -------           -------
Weighted average shares                         
  outstanding (fully diluted)                    60,846            61,321
                                                =======           =======
Income per share before accounting              
  change:                                       
    Primary                                     $   .30           $   .26
    Fully diluted                               $   .30           $   .25
                                                
Net Income per share:                           
    Primary                                     $   .30           $   .31
    Fully diluted                               $   .30           $   .30