What is the equation for the weighted average shares of common stock outstanding? (NIE 9) (Beginning Shares 0.5)(Ending Shares 0,5) Ending Shares number of times the shares changed during the year 12 (Beginning Shares Ending Shares) / 2 None of these are correct

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter16: Retained Earnings And Earnings Per Share
Section: Chapter Questions
Problem 6MC: For purposes of computing the weighted average number of shares outstanding during the year, a...
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What is the equation for the weighted average shares of common stock outstanding? (NIE 9) (Beginning Shares 0.5)(Ending Shares 0,5) Ending Shares number of times the shares changed during the year 12 (Beginning Shares Ending Shares) / 2 None of these are correct .
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Step 1

The weighted average number of shares is calculated by multiplying number of outstanding shares with the percentage of the reporting period for which that number applies for each period.

That means the we takes the number of shares outstanding in each month weighted by the number of months that those shares were outstanding.

 

 

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