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# A corporation with 5,000,000 shares of publicly listed stock

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Current Student
Joined: 11 May 2008
Posts: 554

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A corporation with 5,000,000 shares of publicly listed stock [#permalink]

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11 Sep 2008, 02:46
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A corporation with 5,000,000 shares of publicly listed stock reported total earnings of \$7.20 per share for the first 9 months of operation. During the final quarter the number of publicly listed shares was increased to 10,000,000 shares, and fourth quarter earnings were reported as \$1.25 per share. What are the average annual earnings per share based on the number of shares at the end of the year?

* 1.75
* 2.40
* 3.15
* 3.60
* 4.85

Kudos [?]: 232 [0], given: 0

Director
Joined: 12 Jul 2008
Posts: 514

Kudos [?]: 166 [0], given: 0

Schools: Wharton

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11 Sep 2008, 03:31
arjtryarjtry wrote:
A corporation with 5,000,000 shares of publicly listed stock reported total earnings of \$7.20 per share for the first 9 months of operation. During the final quarter the number of publicly listed shares was increased to 10,000,000 shares, and fourth quarter earnings were reported as \$1.25 per share. What are the average annual earnings per share based on the number of shares at the end of the year?

* 1.75
* 2.40
* 3.15
* 3.60
* 4.85

I get E

5M*7.20+10M*1.25 = 48.5M
48.5M/10M = 4.85

Kudos [?]: 166 [0], given: 0

Re: EPS FOR SHAREHOLDERS   [#permalink] 11 Sep 2008, 03:31
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