Question

WEYERHAEUSER COMPANY*
CONSOLIDATED STATEMENT OF OPERATIONS
for the three-year ended December 31, 2010
DOLLAR AMOUNTS IN MILLIONS, EXCEPT PER SHARE FIGURES
	2010	2009	2008
Net sales and revenues	$        6,552	$        5,528	$        8,100
Cost of products sold	$        5,392	$        5,127	$        7,508
Gross margin	$        1,160	$           401	$           592
Selling, general and administrative expenses	$           677	$           709	$           996
Research and development expenses	$             34	$             51	$             66
Alternative fuel mixture credits (Note 21)	$              -	$         (344)	$              -
Charges for restructuring, closures and impairments (Note 19)	$           149	$           698	$        2,118
Other operating costs (income), net (Note 20)	$         (168)	$         (266)	$             13
Operating income (loss)	$           468	$         (447)	$      (2,601)
Interest income and other	$             83	$             74	$           366
Impairment of investments and other related charges (Note 19)	$             (3)	$             (7)	$         (160)
Interest expense, net of capitalized interest	$         (452)	$         (462)	$         (414)
Earnings (loss) from continuing operations before income taxes	$             96	$         (842)	$      (2,809)
Income tax benefit (Note 21)	$        1,187	$           274	$           900
Earnings (loss) from continuing operations	$        1,283	$         (568)	$      (1,909)
Earnings from discontinued operations, net of income taxes (Note 4)	$              -	$              -	$           667
Net earnings (loss)	$        1,283	$         (568)	$      (1,242)
Less: net (earnings) loss attributable to noncontrolling interests	$             (2)	$             23	$             66
Net earnings (loss) attributable to Weyerhaeuser common shareholders	$        1,281	$         (545)	$      (1,176)
Basic earnings (loss) per share attributable to Weyerhaeuser common shareholders (Note 5):
Continuing operations	$          4.00	$        (2.58)	$        (8.72)
Discontinued operations	$              -	$              -	$          3.15
Net earnings (loss) per share	$          4.00	$        (2.58)	$        (5.57)
Diluted earnings (loss) per share attributable to Weyerhaeuser common shareholders (Note 5):
Continuing operations	$          3.99	$        (2.58)	$        (8.72)
Discontinued operations	$              -	$              -	$          3.15
Net earnings (loss) per share	$          3.99	$        (2.58)	$        (5.57)
Dividends paid per share (Note 2)	$        26.61	$          0.60	$          2.40
Weighted average shares outstanding (in thousands) (Note 5)
Basic	319,976	211,342	211,258
Diluted	321,096	211,342	211,258
CONSOLIDATED BALANCE SHEET (In Part)
LIABILITIES AND EQUITY
Dollar amounts in millions, except per-share figures
	12/31/10	12/31/09
Total liabilities	$        8,815	$      11,196
Equity:
Weyerhaeuser shareholders' interest (Notes 2, 17, and 18):
Common shares: $1.25 per par value, authorized
1,360,000,000 and 400,000,000 shares; issued and
outstanding: 535,975,518 and 211,358,955 shares	$           670	$           264
Other capital	$        4,552	$        1,786
Retained earnings	$           181	$        2,658
Cumulative other comprehensive loss	$         (791)	$         (664)
Total Weyerhaeuser shareholders' interest	$        4,612	$        4,044
Noncontrolling interests	$               2	$             10
Total equity	$        4,614	$        4,054
Total liabilities and equity	$      13,429	$      15,250
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY AND
COMPREHENSIVE INCOME (In Part)
FOR THE THREE-YEAR PERIOD ENDED DECEMBER 31, 2010
DOLLAR AMOUNTS IN MILLIONS
	2010	2009	2008
Common Shares:
Balance at beginning of year	$           264	$           264	$           262
Issued for exercise of stock options	$               1	$              -	$              -
Retraction or redemption of exchangeable shares	$              -	$              -	$               2
Special Dividend (Note 17)	$           405	$              -	$              -
Balance at end of year	$           670	$           264	$           264
Required: a. 1. How many shares of common stock had been issued as of December 31, 2010? 2. How many shares of common stock were outstanding as of December 31, 2010? 3. What share number is used to compute basic earnings per share for 2010? Describe the computation of this number. 4. What share number was used to compute diluted earnings per share for 2010? Describe the computation of this number. 5. Why the substantial difference in shares outstanding at December 31, 2010 and the weighted average shares outstanding at December 31, 2010? b. What earnings per share number would analysts likely put more emphasis on for the year-end period ended December 31, 2010? c. Compute the book value for December 31, 2010.

Answer 1

Required
a. 1 how many shares of common stock had been issued as of December 31, 2010?

Number of Shares issued during 2010 amounting to 324616563

(535975518 – 211358955)

2. How many shares of common stock were outstanding as of December 31, 2010?

Number of Shares outstanding during 2010 amounting to 535,975,518

3. What share number is used to compute basic earnings per share for 2010? Describe the computation of this number.

319, 976,000 are used to compute the basic earnings per share for 2010.

Calculation

Net earnings (loss) attributable to Weyerhaeuser common shareholders (A)	1,281,000,000
Weighted average shares outstanding ( B)	319,976,000
Earnings Per Share ( A / B)	4

4. What share number was used to compute diluted earnings per share for 2010? Describe the computation of this number.

321, 096,000 are used to compute the basic earnings per share for 2010.

Calculation

Net earnings (loss) attributable to Weyerhaeuser common shareholders (A)	1,281,000,000
Weighted average shares outstanding ( B)	321,096,000
Earnings Per Share ( A / B)	3.99

5. Why the substantial difference in shares outstanding at December 31, 2010 and the weighted average shares outstanding at December 31, 2010?

The substantial difference is due to the fact of issue for exercise of stock options and special dividend.

b. What earnings per share number would analysts likely put more emphasis on for the year-end period ended December 31, 2010?

Analysts put more emphasis on Diluted earnings per share as it takes into account all convertible securities in the outstanding number of shares.

c. Compute the book value for December 31, 2010.

Book Value for December 31, 2010 was $13,429,000,000.