For the year ended December 31, 2018, Norstar Industries reported net income of $655,000. At January...

For the year ended December 31, 2018, Norstar Industries reported net income of $655,000. At January 1, 2018, the company had 900,000 common shares outstanding. The following changes in the number of shares occurred during 2018:

Apr.	30	Sold 60,000 shares in a public offering.
May	24	Declared and distributed a 5% stock dividend.
June	1	Issued 72,000 shares as part of the consideration for the purchase of assets from a subsidiary.

Required:

Compute Norstar's earnings per share for the year ended December 31, 2018. (Enter your answers in thousands.)

This is what I have calculated and it is incorrect. Please help.

Weighted average number of shares - Jan 1	900,000
Weighted average number of shares - Apr 30	40,000	(60000*(8/12)
Weighted average of stock dividend shares distributed -May 24	47,000	(900000+C13)*5%
Weighted average of stock dividend shares distributed -June 30	42,000	72000*7/12
Total weighted average number of shares	1,029,000


Earnings per share =	0.637

Expert Solution

ekkarill92 answered 5 months ago

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