At the beginning of 2014, Hardin Company had 220,000 shares of $10 par common stock outstanding....

At the beginning of 2014, Hardin Company had 220,000 shares of $10 par common stock outstanding. During the year, it engaged in the following transactions related to its common stock:

March	1	Issued 43,000 shares of stock at $20 per share.
June	1	Issued a 10% stock dividend.
July	1	Issued 16,000 shares of stock at $25 per share.
Aug.	31	Issued a 2-for-1 stock split on outstanding shares, reducing the par value to $5 per share.
Oct.	31	Reacquired 88,000 shares as treasury stock at a cost of $28 per share.
Nov.	30	Reissued 54,000 treasury shares at a price of $31 per share.

Required:

1. Determine the weighted average number of shares outstanding for computing the current earnings per share. Round your interim computations and final answer for the number of shares to nearest whole number.
_____ shares

2. Determine the number of common shares outstanding at December 31, 2014.
_____ shares

Expert Solution

Solution.

Since there was a 2 for 1 split in September you have to calculate an "as if" the split occurred at the beginning of the year.
Also, your results will depend on whether you use a 360 day (12 30-day months) or a 365 day year. For simplicity's sake, I'll use a 360 day year.
Begin outstanding: 20k * 2 = 40,000
This # of shares was outstanding from Jan 1 thru the day before the # changed on April 2. I'll call this time outstanding "t". "OS" means OutStanding.
40,000 * (91/360) = 10,111.11
At April 2, add 5,000 * 2 = 10,000 for total of 50,000
t = 29 + 30 + 3 = 62 days thru June 3
50,000 * 62/360 = 8611.11
At June 4 add 4,000 * 2 = 8,000 for total of 58,000
t = 27 days thru June 30
58,000 * 27/360 = 4350
At July 1 10% stock dividend...
58,000 * 1.10 = 63,800 shares total OS
t = 30 + 30 + 30 + 2 = 92 days thru Oct 2
63800 * 92/360 = 16304.44
At Oct 3, repurchase 1k shares, total OS 62,800
t = 28 + 26 = 54 days thru Nov 26
62,800 * 54/360 = 9420
At Nov 27 reissue 1k shares, total OS 63,800
t = 3 + 30 = 33
63,800 * 33/360 = 5848.33
Add them all together = WASO (weighted average shares outstanding)
= 54,645 WASO

ekkarill92 answered 8 months ago

At the beginning of 2019, Hardin Company had 230,000 shares of $10 par common stock outstanding....

At the beginning of 2019, Hardin Company had 230,000 shares of $10 par common stock outstanding. During the year, it engaged in the following transactions related to its common stock: March 1 Issued 46,000 shares of stock at $25 per share. June 1 Issued a 20% stock dividend. July 1 Issued 9,000 shares of stock at $30 per share. Aug. 31 Issued a 2-for-1 stock split on outstanding shares, reducing the par value to $5 per share. Oct. 31 Reacquired...

(show Work and calculations) X Company had 200,000 shares of $10 par value common stock outstanding...

(show Work and calculations) X Company had 200,000 shares of $10 par value common stock outstanding during fiscal 2018 along with 10,000 shares of 8%, cumulative, $100 par value preferred stock four years in arrears, with each share convertible into five shares of common stock. X’s fiscal 2018 net income was $800,000 and reflects an income tax rate of 40%. Required—Prepare in good form the fiscal 2018 EPS presentation for X Company

On January 1, Hamblin Corporation had 120,000 shares of $10 par value common stock outstanding. On...

On January 1, Hamblin Corporation had 120,000 shares of $10 par value common stock outstanding. On March 17 the company declared a 10% stock dividend to stockholders of record on March 20. Market value of the stock was $13 per share on March 17. The entry to record the transaction of March 17 would include a Group of answer choices debit to Common Stock Dividends Distributable for $120,000. credit to Stock Dividends for $36,000. credit to Cash for $156,000. credit...

At December 31, 2014, Emley Company had 1,200,000 shares of common stock outstanding. On October 1,...

At December 31, 2014, Emley Company had 1,200,000 shares of common stock outstanding. On October 1, 2015, an additional 400,000 shares of common stock were issued. In addition, Emley had $10,000,000 of 6% convertible bonds outstanding at December 31, 2014, which are convertible into 800,000 shares of common stock. No bonds were converted into common stock in 2015. The net income for the year ended December 31, 2015, was $3,750,000. Assuming the income tax rate was 30%, what should be...

On January 1, 2017 Headland Industries had stock outstanding 9700 shares $970000 Common stock $10 par...

On January 1, 2017 Headland Industries had stock outstanding 9700 shares $970000 Common stock $10 par value, issued and outstanding 200000 shares 2000000 To acquire the net assets of three smaller companies, Headland authorized the issuance of an additional 157200 common shares. The aquisitions took place as shown below. Date of Aquisition. Shares Issued Company A April 1, 2017. 48000 Company B July 1, 2017. 78000 Company C October 1 2017. 31200 On May 14, 2017 Headland realized a $92400...

1. Ajax Enterprises had 220,000 shares of common stock issued and outstanding at December 31, 2025....

1. Ajax Enterprises had 220,000 shares of common stock issued and outstanding at December 31, 2025. Unexercised stock options to purchase 40,000 shares of common stock at $20 per share were outstanding at the beginning and end of 2026. The market price of Glendale's common stock was $25 per share during 2026. Net income for the year ended December 31, 2026, was $1,100,000. What should be Ajax's 2026 diluted earnings per common share, rounded to the nearest penny? 2.Ajax Corporation...

A company has 10,000 shares of $10 par common stock outstanding. Prepare entries to record the...

A company has 10,000 shares of $10 par common stock outstanding. Prepare entries to record the following: a. Purchased 1,000 shares of treasury stock at $12. The treasury stock is accounted for by the cost method. There were no previous purchases of treasury shares. If an amount box does not require an entry, leave it blank. b. Sold 500 shares of treasury stock at $15. If an amount box does not require an entry, leave it blank. c. Purchased equipment...

On January 1, Year 2, Zook Company had 26,000 shares of $1 par common stock outstanding....

On January 1, Year 2, Zook Company had 26,000 shares of $1 par common stock outstanding. During October, Year 2, the company’s board of directors declared and distributed a 1% common stock dividend when the market value of its common stock was $56 per share. In recording this transaction, what amount will be debited to Retained earnings in the journal entry to record the stock dividend?

Dunbar Company had 1,000,000 shares of $1 par value common stock outstanding at January 1, 2015....

Dunbar Company had 1,000,000 shares of $1 par value common stock outstanding at January 1, 2015. On July 1, 2015, the company issued 100,000 additional shares of common stock. In addition, at December 31, 2015, 90,000 shares were issuable upon exercise of executive stock options which require a $40 cash payment upon exercise. The average market price during 2015 was $50. Dunbar Company also has two convertible securities. There are 10,000 convertible bonds with a face amount of $1,000,...

On January 1, Novak Corp. had 99,000 shares of no-par common stock issued and outstanding. The...

On January 1, Novak Corp. had 99,000 shares of no-par common stock issued and outstanding. The stock has a stated value of $4 per share. During the year, the following occurred. Apr. 1 Issued 25,500 additional shares of common stock for $17 per share. June 15 Declared a cash dividend of $1 per share to stockholders of record on June 30. July 10 Paid the $1 cash dividend. Dec. 1 Issued 3,000 additional shares of common stock for $19 per...

Question