Compute weighted average shares outstanding

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Question - Assume that the following data relative to Kane Company for 2018 is available:

Net Income $2,800,000

Transactions in Common Shares Change Cumulative

Jan 1, 2018, Beginning number720,000

Mar. 1, 2018, Purchase of treasury shares (53,400) 666,600

June 1, 2018, Stock split 2-1666,600 1,333,200

Nov. 1, 2018, Issuance of shares 228,000 1,561,200 6% Cumulative Convertible Preferred Stock

Sold at par, convertible into 180,000 shares of common (adjusted for split) $900,000

Stock Options Exercisable at the option price of $25 per share. Average market price in 2018, $30 (market price and option price adjusted for split) 93,000 shares

Required -

1. Compute weighted average shares outstanding for 2018.

2. Compute the basic earnings per share for 2018.

3. Compute the diluted earnings per share for 2018.

Reference no: EM132619707

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