Question

Nagy Industries reported a net income of $679,369 on December 31, 2018. At the beginning of the year, the company had 560,000 common shares outstanding. On April 1, the company sold 30,600 shares for cash. On August 31, the company issued 55,200 additional shares as part of a merger. On December 1, 2018, the company declared and issued a 8% stock dividend. Required: Compute Nagy's net income that would produce a basic EPS of $2.30 per share for 2018. (Round your answer to the nearest whole dollar.)

Answer 1

Net Drome EPS = weighted average number of shares out standing. - 560000 shares are outstanding throughout the year. a) 560000 Shares 30600 shares are outstanding only for a months, because they are issued on Apr ist - 30600x* : 22950 Shares » 50200 shares out standing only for umaths, = 55200 x = 18400 shares. s on Decist 84. stock dividend is issued on. ( 560000+30600 +55200) x 84.= 51664. which will be out standing for month 51664 = 4305 shares weighted average number of shares out standing E 580000 + 22950+ 18400+ 4305 = 606655 shares. 12 Net Income = 606655 X $2.3 11395 307