Question

The following information is available for Bugsy Corporation:

January 1, 2018      Shares outstanding                                             2,000,000

March 1, 2018        Shares issued                                                   570,000

April 1, 2018              Treasury shares purchased                                  100,000

September 1, 2018       Shares issued                                                       300,000

The number of shares to be used in computing earnings per common share (WASO) for 2018 is

Select one:

2,500,000 shares

2,269,167 shares

2,583,333 shares

2,294,167 shares

Answer 1

2,500,000 shares

	Increase / (decrease)	Outstanding	Months Outstanding	Share Months
Jan 1	-	2,000,000	2	4,000,000
Mar 1	570,000	2,570,000	1	2,570,000
April 1	(100,000)	2,470,000	5	12,350,000
Sep 1	300,000	2,770,000	4	11,080,000
				30,000,000
The number of shares to be used			2,500,000
(30,000,000 ÷ 12)