ABC Inc.began business on January 1,2014.Due to difficulties in getting the business started,30 common shares were issued on January 1,2014 to the organizers and 15 additional shares were sold on that date.The company wanted the market to hear about the shares.Therefore,the following share transactions were implemented during the year 2014: February 1: 2 for 1 stock split
April 1: 10 percent stock dividend
August 1: 5 for 1 stock split
December 1: 2 for 1 reverse stock split
The weighted average number of shares outstanding for 2014 was: (Rounded to the nearest whole number)

Question

Quizplus · Accepted Answer

To calculate the weighted average number of shares outstanding, we need to take into account all the share transactions that occurred during the year.

First, we need to add up the initial shares issued to the organizers (30) and the additional shares sold (15) on January 1:

30 + 15 = 45

Then, we need to adjust for the 2 for 1 stock split on February 1:

45 x 2 = 90

Next, we need to adjust for the 10 percent stock dividend on April 1:

90 x 1.1 = 99

Then, we need to adjust for the 5 for 1 stock split on August 1:

99 x 5 = 495

Finally, we need to adjust for the 2 for 1 reverse stock split on December 1:

495 / 2 = 247.5

Round this number to the nearest whole number, and we get:

248 shares

Therefore, the best choice is D.

ABC IncBegan Business on January 1,2014