Question

) On January 1, 2018, Swifty Corp. had 463,000 shares of common stock outstanding. During 2018, it had the following transactions that affected the Common Stock account. February 1 Issued 118,000 shares March 1 Issued a 10% stock dividend May 1 Acquired 103,000 shares of treasury stock June 1 Issued a 3-for-1 stock split October 1 Reissued 63,000 shares of treasury stock Collapse question part

(a) Determine the weighted-average number of shares outstanding as of December 31, 2018. The weighted-average number of shares outstanding Click if you would like to Show Work for this question: Open Show Work

Answer 1

,Answer:

Determination of the weighted average number of shares outstanding as of December 31, 2018

Stock as on Janunary 1, 2018 = 463,000 shares

February 1, Issued stock 118,000 shares = 463,000 + 118000 = 581,000 shares

March 1, Issued 10% Stock Dividend = No effect on oustanding shares so = 581,000 shares

May 1, Acquired 103,000 shares of treasury stock = 581,000 - 103,000 =478,000 shares

June 1, 3 for 1 stock split =478,000 + (478,000 x 3 = 1,434,000) = 1,912,000 shares

October 1, Reissued treasury stock 63,000 = 1,912,000 + 63,000 = 1,975,000 shares

The weighted average number of shares is calculated by taking the number of shares outstanding and multiplying the portion of the reporting period those shares covered, doing this for each portion and summing the total. The weighted average number of outstanding shares is 984,590​ shares

Months Shares Period covered Weights    Weighted shares
Jan 463000     1 1/30 = 0.03          13,890
Feb   581000     11 11/30 = 0.36         209,160
mar   581000    - -    -
may   478000     8 8/30 = 0.26          124,280
jun   1912000    7    7/30 = 0.23          439,760
oct   1975000    3 3/30 = 0.10          197,500

Total 30 984,590