If Convertible Bonds Were Issued at a Discount, When Computing

question 3

Multiple Choice

If convertible bonds were issued at a discount, when computing diluted EPS, the amortization of the bond discount:

• A) Will have no effect.
• B) Will decrease the numerator.
• C) Will increase the numerator.
• D) May increase or decrease the numerator, depending on the amortization method used.

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Definitions:

RAM Chips

Memory modules made of integrated circuits used to store temporary data for quick access by the computer's processor.

Motherboard

The main printed circuit board in a computer, which hosts the central processing unit, memory, and other essential components and connectors for peripherals.

Cache Memory

A small-sized type of volatile computer memory that provides high-speed data access to a processor and stores frequently used computer programs, applications, and data.

Random Access Memory

Volatile memory in computing devices used to store working data and machine code currently in use, allowing for quick data retrieval and storage.