B is corrent. The computation of weighted-average shares outstanding is| Date | # of | | Fraction | | WA | | 1/1 | 39,000 | × | 12/12 | = | 39,000 | | 2/1 | 3,000 | × | 12/12 | = | 3,000 | | 7/1 | 8,000 | × | 6/12 | = | 4,000 | | | | | | | 46,000 |
The 3,000 shares issued as a result of a stock dividend are weighted at 12/12 instead of 11/12 because for EPS purposes stock dividends are treated as if they occurred at the beginning of the year.A is incorrect. The computation of weighted-average shares outstanding is| Date | # of | | Fraction | | WA | | 1/1 | 39,000 | × | 12/12 | = | 39,000 | | 2/1 | 3,000 | × | 12/12 | = | 3,000 | | 7/1 | 8,000 | × | 6/12 | = | 4,000 | | | | | | | 46,000 |
The 3,000 shares issued as a result of a stock dividend are weighted at 12/12 instead of 11/12 because for EPS purposes stock dividends are treated as if they occurred at the beginning of the year.C is incorrect. The computation of weighted-average shares outstanding is| Date | # of | | Fraction | | WA | | 1/1 | 39,000 | × | 12/12 | = | 39,000 | | 2/1 | 3,000 | × | 12/12 | = | 3,000 | | 7/1 | 8,000 | × | 6/12 | = | 4,000 | | | | | | | 46,000 |
The 3,000 shares issued as a result of a stock dividend are weighted at 12/12 instead of 11/12 because for EPS purposes stock dividends are treated as if they occurred at the beginning of the year.D is incorrect.The computation of weighted-average shares outstanding is| Date | # of | | Fraction | | WA | | 1/1 | 39,000 | × | 12/12 | = | 39,000 | | 2/1 | 3,000 | × | 12/12 | = | 3,000 | | 7/1 | 8,000 | × | 6/12 | = | 4,000 | | | | | | | 46,000 |
The 3,000 shares issued as a result of a stock dividend are weighted at 12/12 instead of 11/12 because for EPS purposes stock dividends are treated as if they occurred at the beginning of the year. |
