<p>On Jan 1, 2009 Ryan Corporation had 30,000 shares of common stock outstanding

Question

<p>On Jan 1, 2009 Ryan Corporation had 30,000 shares of common stock outstanding. On June 1, 2009 Ryan Corporation sold an additional 50,000 shares of common. At no time during 2010 did Ryan Corp. issue any additional shares of common stock. (a) What was the weighted-average number of shares of common stock used for earnings per share calculations for 2009 and 2010. (b) What were the earnings per share if net income for 2009 total $140,000 and $175,000 for 2010. Show Computations.</p>

Explanation / Answer

For 2009 Weighted average number of common stock = 30000*1 year                      30,000.00 =50000*7/12                      29,166.67 Total weighted varega number of stock                      59,166.67 For 2010 Weighted average number of common stock =30000+50000 80000 EPS   2009 2010 Net income (a)                    140,000.00                       175,000.00 Weighted average number of common stock (b)                      59,166.67                         80,000.00 EPS (a/b)                              2.37                                 2.19

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