[jorden_rowrow]

Rudd Corp. had 700,000 shares of common stock authorized and 300,000 shares outstanding at December 31, Year 1. The following events occurred during Year 2:

January 31 Declared 10% stock dividend

June 30 Purchased 100,000 shares

August 1 Reissued 50,000 shares

November 30 Declared 2-for-l stock split

At December 31, Year 2, how many shares of common stock did Rudd have outstanding?

a. 660,000

b. 560,000

c. 630,000

d. 600,000

The answer is B and I know how they got that, they just added and subtracted the shares. But i have question, why didn’t we do the shares multiplied by the months it was used in? I know it has to be in the call of the question but how do i know which one to do. The reason why i’m asking is because i sat there multiplying each share by the months

[livealittle]

they are asking for how many shares outstanding at a specific date, not the average shares outstanding

when they ask as of a specific date, that is the number of shares on that date, no matter how long they have been outstanding.

BEC - 8/8/16
REG - 66, 77
AUD - 81
FAR - 9/8/16

[Author]

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