E16-15 (Weighted-Average Number of Shares) Newton Inc. uses a calendar year for financial9,000,000$10shares ofreporting. The company is authorized to issuepar common stock. At no time has Newton issued any potentially dilutive securities. Listed below is asummary of Newtons common stock activities.1. Number of common shares issued and outstanding at December 31, 20122,000,0002. Shares issued as a result of a 10% stock dividend on September 30, 2013200,0003. Shares issued for cash on March 31, 20142,000,000Number of common shares issued and outstanding at December 31, 20144,200,0004. A 2-for-1 stock split of Gogeans common stock took place on March 31, 2015Instructions:(a) Compute the weighted average number of common shares used in computing earnings percommon share for 2013 on the 2014 comparative income statement.Text titleText titleText titleText titleShares outstandingFormulaPercentageFormulaFormulaFormula(b) Compute the weighted average number of common shares used in computing earnings percommon share for 2014 on the 2014 comparative income statement.Text titleText titleShares outstandingFormulaFormulaFormula(c) Compute the weighted average number of common shares to be used in computing earnings percommon share for 2014 on the 2015 comparative income statement.Text titleText titleShares outstandingFormulaNumberFormula(d) Compute the weighted average number of common shares to be used in computing earnings percommon share for 2015 on the 2015 comparative income statement.Text titleText titleText titleText titleShares outstanding
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