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                                                                    EXHIBIT 11.1
 
                               REMEDY CORPORATION
 
                           COMPUTATION OF NET INCOME
                     PER COMMON AND COMMON EQUIVALENT SHARE
                    (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
                                  (UNAUDITED)
 
<TABLE>
<CAPTION>
                                                              THREE MONTHS
                                                             ENDED SEPTEMBER    NINE MONTHS ENDED
                                                                   30,            SEPTEMBER 30,
                                                            -----------------   -----------------
                                                             1996      1995      1996      1995
                                                            -------   -------   -------   -------
<S>                                                         <C>       <C>       <C>       <C>
Primary
  Weighted average number of common shares
     outstanding(1).......................................   26,497    24,843    26,224    20,260
  Convertible preferred shares, as if converted(1)........       --        --        --     2,518
  Incremental common shares attributable to shares
     issuable under employee stock plans(1)...............    3,345     4,089     3,630     4,356
                                                            --------  --------  --------  --------
     Total shares(1)......................................   29,842    28,932    29,854    27,134
                                                            ========  ========  ========  ========
Net income:
  Amount..................................................  $ 4,393   $ 2,084   $10,040   $ 4,543
                                                            ========  ========  ========  ========
  Per share (1)...........................................  $  0.15   $  0.07   $  0.34   $  0.17
                                                            ========  ========  ========  ========
Fully diluted
  Weighted average number of common shares
     outstanding(1).......................................   26,497    24,843    26,224    20,260
  Convertible preferred shares, as if converted(1)........       --        --        --     2,518
  Incremental common shares attributable to shares
     issuable under employee stock plans(1)...............    3,753     4,089     3,837     4,408
                                                            --------  --------  --------  --------
     Total shares(1)......................................   30,250    28,932    30,061    27,186
                                                            ========  ========  ========  ========
Net income:
  Amount..................................................  $ 4,393   $ 2,084   $10,040   $ 4,543
                                                            ========  ========  ========  ========
  Per share(1)............................................  $  0.15   $  0.07   $  0.33   $  0.17
                                                            ========  ========  ========  ========
</TABLE>
 
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(1) All periods reflect a two-for-one stock dividend effected as of October 25,
    1996. See note (2) to the condensed consolidated financial statements.