1.Based on the stock transactions below, what is the weighted average number of shares outstanding as of December 31, Year 1 that should be used in the calculation of basic earnings per share in the financial statements issued on March 1, Year 2?

Date Transactions

January 1, Year 1 Beginning Balance100,000

April 1, Year 1 Issued 30,000 shares for cash

June 1, Year 1 50% stock dividend

February 15, Year 2 2-for-1 stock split

March 15, Year 2 Issued 40,000 shares for cash