$20\%10\%,$$$100$ par, non$-$cumulative preference shares

outstanding for the entire year.

Requirements:

Compute the weighted average ordinary shares outstanding for $2022.$

Starting Shares $(January1-$ February $1)$

$480,000$ shares $\frac{1}{12}of$ the year $=40,0001-$ May $1480,000+120,000=600,000$ shares

Weight for $3$ months: $600,000\frac{3}{12}=150,000(weighted$ shares$)$

After Acquiring $40,000$ Treasury Shares $(May1-$ June $1)$

New total: $600,000-40,000=560,000$ shares

Weight for $1$ month: $560,000\frac{1}{12}=46,667(weighted$ shares$)$

After $3-$for$-1$ Share Split $(June1-$ October $1)$

Total shares: $560,0003=1,680,000$ shares $1-$ October $1560,0003=1,680,000$ shares

Weight for $4$ months: $1,680,000\frac{4}{12}=560,0001-$ December $31+20,000=1,700,000$ shares

Weight for $3$ months: $1,700,000\frac{3}{12}=425,000(weighted$ shares$)$

Total Weighted Average Ordinary Shares

Adding all the weighted shares together:

$40,000+150,000+46,667+560,000+425,000=1,221,667$ shares $40,000+150,000+46,667+560,000+$

$425,000=1,221,\frac{667}{\frac{?}{?}}$ text$\{$ shares$\}40,000+150,000+46,667+560,000+425,000=1,221,667$ shares Compute earnings per share for $2022$ assuming that Waterway the company did

not declare and pay a preference dividend $in2022$:

EPS$=\frac{\text{N}\text{e}\text{t}\text{I}\text{n}\text{c}\text{o}\text{m}\text{e}-\text{P}\text{r}\text{e}\text{f}\text{e}\text{r}\text{e}\text{n}\text{c}\text{e}\text{D}\text{i}\text{v}\text{i}\text{d}\text{e}\text{n}\text{d}\text{s}}{\text{W}\text{e}\text{i}\text{g}\text{h}\text{t}\text{e}\text{d}\text{A}\text{v}\text{e}\text{r}\text{a}\text{g}\text{e}\text{O}\text{r}\text{d}\text{i}\text{n}\text{a}\text{r}\text{y}\text{S}\text{h}\text{a}\text{r}\text{e}\text{s}Outstanding}$

EPS$=\frac{3,408,000}{1,221,667}$

EPS~~$2\mathrm{.}79$ Details:

Number $of$ shares repurchased: $5,000$

Price per share: $$100$

Total cost $of$ repurchase: $5,000$ shares $$$$100=$$$500,000$

Journal Entry:

Debit: Treasury Stock $$$$500,000$

Credit: Cash $$$$500,000$

$On$ September $1$ son, Phelps deolared $5160,000$ cash divhdevds, $of$ which $540,000$ were

liquictaring clividencis.

$On$ Sep $2^{nd}$$$1,000$ par value$98\%.$ Each bond was

issued with one detachable share warrant. $At$ issuance, the net present value $of$ the

bonds without the warrants was $$2,910,000.$ Prepare the journal entry $to$ record the

issuance $of$ the bonds and the ehame warrante

$On$ Oct $1^{st}$ Phelps repurchased the convertible bonds issued $on$ April $1^{st}(abovein$

Point $4)$$$3,950,000,$ while

the fair value $of$ the liability component was $3,875,000.**************************(solve$ point $6to9$ only$)****************************$