- CFA Exams
- CFA Exam: Level I 2021
- Study Session 7. Financial Reporting and Analysis (2)
- Reading 21. Understanding Income Statements
- Subject 7. Earnings per Share
CFA Practice Question
There are 534 practice questions for this study session.
CFA Practice Question
If a company had 10,000 common shares outstanding for the first three months of the year, 12,000 common shares outstanding for the next three months of the year, and 15,000 shares outstanding for the last six months of the year, the weighted-average number of common shares outstanding is ______.
Correct Answer: 13,000
10,000 shares X 3/12 = 2,500. 12,000 shares X 3/12 = 3,000. 15,000 shares X 6/12 = 7,500. Weighted-average shares outstanding: 2,500 + 3,000 + 7,500 = 13,000
User Contributed Comments 12
|rethan||Is this answer correct?
Doing the weighted number of shares using Synner's method (from previous question) which I believe to be correct
10,000X12/12 + 2,000X9/12+5,000X6/12
Should it not be 14K instead of 13K
|chessdude||rethan: it should be 10,000X12/12 + 2,000X9/12+3,000X6/12 = 13,000. the answer is correct.|
|gazelle||How can we find this result using the HP 12C?|
10,000 enter 3 sigma+ (this key is below #3)
12,000 enter 3 sigma+
15,000 enter 6 sigma+
punch in g (blue button) then x, w (key=#6)
|miiyeung||(10sh*12mnth outst + 2*9 + 3*6)/12 = 13k
10k*12mnthOutst + (12k-10k)*9 + (15k-12k)*9 = 13k
Think of the shares as when it is issued...
so issuing 2000 shares on April 01 or March31.
Issue 3000 new shares June31 or July01.
and 10 000 shares common stock outstanding in January01 or Dec31
hmm.. can this be calculated on BA II calculator? no HP on me..
|bundy||it takes 2 seconds in your head don't need a calculator|
|cleopatraliao||Here it doesn't talk about additional shares...so don't have to add the values together...i got stuck on that :(:(|
|gulfa99||take the average of the first two..since the first two are for as of March and June closing. 10+12/2 = 11k outstanding as of June end. Next take the average of 11 + 15 /2 = 13
average of June and december
|kondagadu||This is easier I feel...
|leon121||Or what I did was:
10,000 + 2,000*9/12 + 3,000*6/12 = 13