Multiple Choice
What is the correct treatment of a stock dividend issued in mid-year when computing the weighted-average number of common shares outstanding for earnings per share purposes?
A) The stock dividend should be weighted by the length of time that the additional number of shares are outstanding during the period.
B) The stock dividend should be included in the weighted-average number of common shares outstanding only if the additional shares result in a decrease of 3 percent or more in earnings per share.
C) The stock dividend should be weighted as if the additional shares were issued at the beginning of the year.
D) The stock dividend should be ignored since no additional capital was received.
Correct Answer:
Verified
Correct Answer:
Verified
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