Weighted Average Common Shares
Regal Inc. (Regal) a competitor of Formula 400 SS Inc is a public company that reports
all financial information including EPS. It has a December 31 year-end. It issued its 2024
year-end financial statements on March 1, 2025. Please review the following information
on it capital structure:
Date Description Number of Shares
December 31, 2022 Common shares issued and outstanding 3,750,000
March 31, 2024 Common shares sold and issued 2,500,000
Shares were issued because of a 7.5% stock dividend on July 31, 2023. On March 31,
2025, a stock split occurred at a rate of 3-for-1.
Required:
1. What is the weighted average number of common shares that should be used in
calculating basic EPS for 2023?
2. When preparing the 2024 financial statements, what is the weighted average
number of common shares that should be used in calculating EPS for 2023?