Forums
Back
Weighted Average no. of Shares
Accountancy
Why Re-acquired shares were subtracted ?
Answers (3)
When calculating the weighted average number of shares outstanding for the year, we need to subtract the re-acquired shares from the total number of shares outstanding during the period they were outstanding. This is because the re-acquired shares are no longer outstanding and should not be counted as part of the weighted average.
To calculate the weighted average number of shares outstanding for the year, we need to multiply the number of shares outstanding during each period by the length of time they were outstanding, and then add up the results. However, we need to exclude the re-acquired shares from the calculation, because they are no longer outstanding and should not be counted as part of the weighted average.