Weighted average shares calculation example
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I have the following question that every time I compute the earnings per share, I keep coming up with two different answers. I'm trying to figure out what I am doing wrong:
The following information is available for a corporation:
January 1, 2011 Shares outstanding 1,250,000
April 1, 2011 Shares issued 200,000
July 1, 2011 Treasury shares purchased 75,000
October 1, 2011 Shares issued in a 100% stock dividend 1,375,000
The number of shares to be used in computing earnings per common share for 2011 is:
a. 2,825,500
b. 2,737,500
c. 2,725,000
d. 1,706,250
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Solution Summary
Provides steps necessary to calculate the weighted average shares from the data given.
Solution Preview
Since there is a 100% stock dividend on Oct 1, all shares prior to Oct 1 would be adjusted for 100% stock ...
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