When Preparing Financial Statements the Accounting Consideration of Convertible Bonds

question 30

Multiple Choice

When preparing financial statements the accounting consideration of convertible bonds include:

• A) adding shares from conversion to shares outstanding in the numerator of the diluted earnings per shares calculation.
• B) the effect of convertibles on basic earnings per share.
• C) adjusting after tax earnings in the denominator of the diluted earnings per shares calculation.
• D) redefining earnings to add the costs related to the convertible securities to the numerator of the EPS ratio.

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Definitions:

Basic Needs

Essential requirements for human survival and well-being, such as food, water, shelter, and safety.

Minimum Wage

The lowest legal salary that workers can be paid by employers, set by government policy to ensure a basic standard of living for employees.

Protectionism

An economic policy aimed at restricting imports from other countries through tariffs and quotas to protect domestic industries.

World Trade Organization

An international organization designed to supervise and liberalize world trade, by providing a forum for trade negotiations and dispute resolutions.