Doubt about an example from Schweser

Hi PPl, Need ur help just started with FSA and i came across an example i hve a doubt. the example is named effect of stock dividends in study session 8 in assigned reading 32. Now the doubt: while caculating the stock dividend shares i didnot understand why 10% that is applied should start from Jan for 10000 shares and for 4000 shares from April. Shouldnot 10% be applied on 10000+4000 shares on July and therefore be multiplied by 6 and not by (12 and 9 respectively) heregoes my calculation: Compute the weigh red average number of posr-stock dividend shares Jan Initial shares 10000 x 12 monrhs outstanding 120000 April Issued shares 4.000 x 9 monrhs outstanding 36000 July Stock dividend 10% on (10000+4000)*6 8400 Retired shares 3000*4 (12000) Total share-month 152400 average shares 152400/12 12700 my logic is the stock dividend happens in July so the shares come into existence only in jUly so they should be multiplied by 6 and not by 12 and 9 .

stock dividends are always applied from start of the entire period. they are effective for the whole year. The book mentions that specifically.

stock dividends are always applied from the start of the period, and/OR from the date the stock was issued. to clarify – correct?

say 1/1 1000 shares 4/1 500 shares issued 7/1 2:1 stock dividend you would calculate WASO as 1/1 1000 * 2 * 12/12=2000 4/1 500*2*9/12 = 750

Is it mentioned in Schweser? thanks a lot for clarrifyin my doubt.

Yes they mentioned it in page 66 at the end of the example that you’ve already pointed out. CFA text also states " for the EPS calculation purpose, a stock split is treated as if it occurred at the beginning of the period" in the example 15 page 168, vol 3. I think stock dividend and stock split are treated in similar manner.