31. Weighted average shares outstanding. On January 1, 2017, Warren Corporation

Question

31. Weighted average shares outstanding. On January 1, 2017, Warren Corporation had 1,000,000 shares of common stock outstanding. On March 1, the corporation issued 150,000 new shares to raise additional capital. On July 1, the corporation declared and issued a 2-for-1 stock split. On October 1, the corporation purchased on the market 500,000 of its own outstanding shares and retired them. Instructions Compute the weighted average number of shares to be used in computing earnings per share for 2017 Page 6 Double-click to hide white space

Explanation / Answer

Shares outstanding Months outstanding Weighted shares January and February 1,000,000 2 166,666.67 March to June (1,000,000+150,000) 1,150,000 4 383,333.33 July to September (1,150,000*2) 2,300,000 3 575,000.00 October to December (2,300,000-500,000) 1,800,000 3 450,000.00 Weighted average number of shares outstanding 1,575,000.00

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