Gualtieri Inc.'s shareholders' equity accounts were as follows at the beginning of the current fiscal year, August

Question:

Gualtieri Inc.'s shareholders' equity accounts were as follows at the beginning of the current fiscal year, August 1, 2017:
$1 noncumulative preferred shares (100,000 shares issued)..................$2,500,000
Common shares (350,000 shares issued).................................................3,500,000
Retained earnings.....................................................................................2,500,000
Total shareholders' equity......................................................................$8,500,000
During the year, the following selected transactions occurred:
Oct. 1 Reacquired 24,000 common shares for $20 per share.
Dec. 1 Issued 60,000 common shares for $25 per share.
Feb. 1 Issued 10,000 common shares for $26 per share.
June 20 Declared the annual preferred cash to shareholders of record on July 10, payable on July 31.
July 31 Net income for the year ended July 31, 2018, was $1,280,000.
Instructions
(a) Calculate the weighted average number of common shares for the year.
(b) Calculate the basic earnings per share.
(c) Why is it important to use a weighted average number of shares in the calculation of basic earnings per share? Why not just use the number of shares issued at year end?
(d) Would your answer to part P11.8A (b) change if the preferred share had not been declared on June 20? Explain.
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...