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, 2011:
$5 noncumulative preferred shares (25,000 shares issued)....................$2,500,000
Common shares (350,000 shares issued) .........................................3,750,000
Retained earnings......................................................................2,250,000
Total shareholders' equity..........................................................$8,500,000
During the year, the following selected transactions occurred:
Dec. 1 Issued 60,000 common shares for $20 per share.
Feb. 1 Reacquired and retired 10,000 common shares for $21 per share.
June 20 Declared the annual preferred to shareholders of record on July 10, payable on July 31.
July 31 Profit for the year ended July 31, 2012, was $1,280,000.
Instructions
(a) Calculate the weighted average number of common shares for the year.
(b) Calculate the earnings per share.
(c) Why is it important to use a weighted average number of shares in the calculation of earnings per share? Why not just use the number of shares issued at year end?
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...