Question

There are 25,000 shares outstanding throughout the year. What is the earnings per share?

Answer 1

Answer:

25,000 shares * 12/12 = 25,000 outstanding entire year. + 5,000 shares * 6/12 = 2,500 outstanding last 6 months. Weighted average common shares: 25,000 + 2,500 = 27,500.