To Calculate Diluted EPS,the Accountant Does All of the Following

question 9

Multiple Choice

To calculate diluted EPS,the accountant does all of the following except:

• A) adds back to net income any compensation expense recognized on the employee stock options
• B) adds back any interest expense (net of taxes) on convertible bonds
• C) adds back any dividends on convertible preferred stock the firm subtracted in computing net income to common shareholders.
• D) enters only the net incremental shares issued (shares issued under options minus assumed shares repurchased) in the computation of diluted EPS.

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Definitions:

Criterion Groups

Specific groups used as reference points or standards when evaluating the characteristics or outcomes of other groups.

Control Groups

Refer to groups in experimental research that do not receive the experimental treatment, used as a benchmark to measure the effect of the treatment.

Executive-Type Norms

Guidelines or standards set by those in leadership positions within organizations, influencing behavior and decision-making.