In the Weighted Average Ownership % column the program calculates the weighted average ownership percentage for each partner. The Weighted Average Percentage is what the partner percentage would be if it had been one consistent percentage throughout the entire year.
Here is an example of how the calculation is created:
If a partner owned 20% of the company stock for the first 6 months and 50% for the next 6 months, the average ownership percentage = 35.12%
Number of days from:
- Jan 1 - June 30 = 181 (if not a leap year).
- July 1 - December 31 = 184.
181 X .20 = 36.2 (amount of days in the first 6 months times the ownership percentage for that period)
184 X .50 = 92.0 (amount of days in the last 6 months times the ownership percentage for that period)
36.2 + 92.0 = 128.2
128.2 / 365 = 35.12%