Question

Sweet Inc. uses a calendar year for financial reporting. The company is authorized to issue 8,770,000 shares of $10 par common stock. At no time has Sweet issued any potentially dilutive securities. Listed below is a summary of Sweet's common stock activities. 1. 2. 3. Number of common shares issued and outstanding at December 31, 2018 Shares issued as a result of a 10% stock dividend on September 30, 2019 Shares issued for cash on March 31, 2020 Number of common shares issued and outstanding at December 31, 2020 A 2-for-1 stock split of Sweet's common stock took place on March 31, 2021 2,050,000 205,000 1,910,000 4,165,000 4. Compute the weighted average number of common shares used in computing earnings per common share for 2019 on the 2020 comparative Income statement. shares Compute the weighted average number of common shares used in computing earnings per common share for 2020 on the 2020 comparative income statement. shares Compute the weighted average number of common shares to be used in computing earnings per common share for 2020 on the 2021 comparative income statement. shares Compute the weighted average number of common shares to be used in computing earnings per common share for 2021 on the 2021 comparative income statement. shares

Answer 1

Answert A) san-1-2019 - Sep 30, 2019 (2050000 9/2) - 1537,500 Retroaclive adjustment for stock dividerdo x 1:10 Jau./2019-sep 30, 2019 Adjustment = 1,691250 Oct.1.2019-Dec 312019 (2,050,000+205.000)7]= 563,750 Total shares . = 2,255,000 shares B) Jan 1, 2020- HQ7362020 (2255,000x3he) 563750 Apr 1, 2020 - Dec 31 2020 (4165,000x9h2 = 3,123,750 Total shares = 3687,500 shares c) 2020 weighted average no of shares : 3,687,500 Retroactive adjustment for stock split « *2 Total shayes 7,375,000 shares D) Jan 1, 2021- Mar 312021 (4,165,000x3/12) = 1,041,250 Retroaclive adjustment for stock split = x 2 3au.1- Mar 31,2011 Adjust ed = 2,082,500 Apr-1,2021 - Dec 31,9021 141.165000x2x9%87 = 6,247,500 Total shares 8,330,000 shares