Chinook Corporation started the year ended November 30, 2012, with 60,000 common shares and no preferred shares

Question:

Chinook started the year ended November 30, 2012, with 60,000 common shares and no preferred shares issued. The following changes in share capital occurred during the year:
Feb. 28 Issued 15,000 common shares for $225,000.
May 31 Reacquired and retired 5,000 common shares for $90,000.
Sept. 1 Issued 20,000 $1 cumulative preferred shares for $500,000.
Nov. 1 Issued 6,000 common shares in exchange for land. The shares were trading for $20 on this date and the fair value of the land was $115,000.
30 Reported profit of $351,250.
30 Declared the quarterly cash to the preferred shareholders of record on December 16, payable on December 31.
Instructions
(a) Calculate the profit available for the common shareholders.
(b) Calculate the weighted average number of common shares for the year.
(c) Calculate the earnings per share for the year.
(d) Why is it necessary to calculate a weighted average number of shares? Why not use the number of shares at the end of the year?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...