A Company Has Stock Options Outstanding Which Allow the Holders

question 93

True/False

A company has stock options outstanding which allow the holders of the options to buy 12,000 shares of common stock;therefore 12,000 shares will be added to the denominator when calculating diluted earnings per share.

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Definitions:

Current Liabilities

Current liabilities are financial obligations a company needs to pay within one year, including accounts payable, short-term loans, and other similar debts.

Owner's Equity

The residual interest in the assets of a business after deducting its liabilities, representing the ownership's claim on the assets.

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within one year or a business cycle, whichever is longer.

Long-Term Liabilities

Obligations or debts a company is responsible for paying beyond one year from the date of the balance sheet.