Question

Douglas Corporation had 120,000 shares of stock outstanding on January 1, 2017. On May 1, 2017, Douglas issued 60,000 shares. On July 1, Douglas purchased 10,000 treasury shares, which were reissued on October 1. Compute Douglas’s weighted-average number of shares outstanding for 2017.

Short answer

Douglas’s weighted-average number of shares outstanding for 2017 is $157,500.

Step-by-step solution

The information given is as follows

Shares of stock outstanding on January 1, 2017, is $120,000.

Issue on May 1, 2017, is 60,000.

Treasury shares are 10,000.

Computation of weighted average number of shares outstanding for 2017

Date outstanding	Share outstanding	Fraction of year	Weighted share
1/1–5/1	120,000	4/12	40,000
5/1–7/1	180,000	2/12	30,000
7/1–10/1	170,000	3/12	42,500
10/1–12/31	180,000	3/12	45,000
			157,500