Answer:
weighted average of outstanding shares. 124,000
for diluted EPS: 145,000
Explanation:
beginning 100,000
+ 30,000 x 7/12 (May issued shares)
+ 13,000 x 6/12 (130,000 x 10% stock dividends)
100,000 + 17,500 + 6,500 = 124,000 shares for the weighted average of outstanding shares.
for the diluted earning per share:
each bond can convert to 21 shares, potentially increasing the amount of shares outstanding to:
1,000 x 21 = 21,000 new shares
<u>so for diluted EPS we will use:</u>
124,000 + 21,000 = 145,000
