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NACVA Exam CVA Topic 3 Question 109 Discussion

Actual exam question for NACVA's CVA exam
Question #: 109
Topic #: 3
[All CVA Questions]

Let's say that a company had 100,000 shares outstanding at the beginning of the year and issued 30,000 more shares on May 1. The 100,000 shares would be outstanding for four months and the 130,000 shares for eight months, or two-thirds of the year. The weighted average number of shares outstanding for the year would be:

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Suggested Answer: B

by Lawrence at Apr 03, 2025, 01:30 PM

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Scarlet
3 months ago
Woohoo, a weighted average question! This is my jam. Alright, let's do this. *cracks knuckles* B) 120,000 shares, no doubt about it. I can practically smell the points on this one.
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Josefa
2 months ago
I agree with B) 120,000 shares. The extra shares issued in May don't have as much impact on the weighted average.
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Samira
2 months ago
I'm going with A) 100,000 shares. I think the original shares for 4 months should have more weight.
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Mariko
2 months ago
Hmm, I see your point. But I'm sticking with B) 120,000 shares. I'm pretty confident in my calculation.
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Fredric
3 months ago
I think it's actually C) 140,000 shares. The extra shares issued in May would be weighted for 8 months, not 4.
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Glory
3 months ago
Haha, this is like a math word problem straight out of my high school days. Let me see, 100,000 shares for 4 months, 130,000 shares for 8 months... Yep, B) 120,000 is the weighted average. Easy peasy!
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Apolonia
3 months ago
Wait, wait, wait. If the total shares were 130,000 for 8 months, that's 1,040,000 share-months. And the 100,000 shares for 4 months is 400,000 share-months. The total is 1,440,000 share-months, which divided by 12 months is 120,000 shares. B) is right, I got this!
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Timothy
2 months ago
Great job on figuring that out! It's important to understand how to calculate these financial metrics.
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Bette
3 months ago
Yes, you're correct! It's based on the weighted average number of shares outstanding for the year.
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Miesha
3 months ago
I think the answer is B) 120,000
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Stanton
4 months ago
Okay, let me think this through. We have 100,000 shares for 4 months and 130,000 shares for 8 months. That's a total of 12 months, so the weighted average should be 120,000. B) is the answer.
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Delsie
3 months ago
Great, so the answer is B) 120,000 shares.
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Dell
3 months ago
Yes, I agree. It makes sense to calculate it that way.
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Jose
3 months ago
I think you're right, the weighted average should be 120,000 shares.
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Penney
4 months ago
Hmm, let's see. If there were 100,000 shares for 4 months and 130,000 shares for 8 months, that sounds like a weighted average. I'll go with B) 120,000.
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Brett
4 months ago
I'm not sure about this one. Can someone explain how to calculate the weighted average number of shares outstanding?
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Enola
5 months ago
I agree with Vi. The rationale is that we need to calculate the weighted average based on the time each set of shares was outstanding.
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Vi
5 months ago
I think the answer is B) 120,000.
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