Exercise 16-15 Sarasota Inc. uses a calendar year for financial reporting. The company is authorized to issue...

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Accounting

Exercise 16-15
Sarasota Inc. uses a calendar year for financial reporting. Thecompany is authorized to issue 9,640,000 shares of $10 par commonstock. At no time has Sarasota issued any potentially dilutivesecurities. Listed below is a summary of Sarasota’s common stockactivities.

1.Number of common shares issued and outstanding at December 31,2015
2,140,000
2.Shares issued as a result of a 10% stock dividend on September30, 2016
214,000
3.Shares issued for cash on March 31, 2017
2,160,000
Number of common shares issued and outstanding at December 31,2017
4,514,000
4.A 2-for-1 stock split of Sarasota’s common stock took place onMarch 31, 2018
Compute the weighted-average number of common shares used incomputing earnings per common share for 2016 on the 2017comparative income statement.
Compute the weighted-average number of common shares used incomputing earnings per common share for 2017 on the 2017comparative income statement.
Compute the weighted-average number of common shares to be usedin computing earnings per common share for 2017 on the 2018comparative income statement.
Compute the weighted-average number of common shares to be usedin computing earnings per common share for 2018 on the 2018comparative income statement.

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Solution A Weighted average number of common shares to be used in computing earnings per common share for 2016 on the 2017 comparative income statement Outstanding shares at beginning of 2016 restated with stock dividend See Answer

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