Following is the data for company XYZ in respect of number of equity shares during the financial year 20X1-20X2. Find out the number of shares for…

The closing balance of the outstanding shares is 2,05,000 by a normal addition and subtraction. But as per weighted average concept, one need to find out for how many days each type of shares was actually held during the year. The shares which were there on 1st April 20X1, were held for the whole year. Therefore, weighted average number of such shares will be given by the formula: No of shares x no of days the shares were held during the year / 365 = 1,00,000 x 365 / 365 = 1,00,000 But the shares which were issued on 15th June 20X1, were held for only 290 days. Therefore, the weighted average number of shares will be 75,000 x 290 / 365 = 59,589. Following the above formula, the weighted average number of shares for calculation of EPS for the year 20X1-20X2 will be as follows: Sr. No. Date Particulars No of shares No of days shares were outstanding Weighted average no of shares 1 1-Apr-20X1 Opening balance of outstanding equity shares 1,00,000 365 1,00,000 2 15-Jun-20X1 Issue of equity shares 75,000 290 59,589 3 8-Nov-20X1 Conversion of convertible preference shares in Equity 50,000 144 19,726 4 22-Feb-20X2 Buy back of shares (20,000) (38)* (2,082) Total Weighted Average Shares 177,233 * These shares had already been considered in the shares issued. The same has been deducted assuming that the bought back shares have been extinguished immediately.