Answer:
The answer is 872,000
Explanation:
The shares are bought on different dates, so we need to factor this in.
From January 1 to December 31:
800,000 shares(A full year)
From May 1 to December 31:
8/12 x 126,000 shares
=84,000 shares
From September 1 to December 31:
4/12 x 63,000 shares
= 21,000 shares
And from November to December 31;
2/12 x 54,000 shares
9,000 shares.
Therefore, the weighted average shares outstanding for the year is:
800,000 + 84,000 - 21,000 + 9,000 shares
= 872,000
The reason why 21,000 shares was substracted from the rest was because the 63,000 shares was a treasury stock i.e shares buy back and treasury stock reduces number of outstanding shares
