During its first year of operations, McCollum Tool Works entered into the following transactions relating to shareholders'

Question:

During its first year of operations, McCollum Tool Works entered into the following transactions relating to shareholders' equity. The corporation was authorized to issue 100 million common shares, $1 par per share.

Jan.2 Issued 35 million common shares for cash.

3Entered an agreement with the company president to issue up to 2 million additional shares of common stock in 2012 based on the earnings of McCollum in 2012. If net income exceeds $140 million, the president will receive 1 million shares; 2 million shares if net income exceeds $150 million.

Mar.31 Issued 4 million shares in exchange for plant facilities.

Net income for 2011 was $148 million.

Required:

Compute basic and diluted earnings per share for the year ended December 31, 2011.

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...