Which Statement Best Reflects the Issues Associated with the Computation

question 103

Multiple Choice

Which statement best reflects the issues associated with the computation of diluted earnings per share?

• A) Diluted earnings per share represent the potential impact of all shares of common stock.
• B) When presenting comparative financial statements, the impact of convertible bonds must be included for both years.
• C) Common stock options are considered dilutive when the average market price is greater than the option price.
• D) The impact on the denominator is always the determinate of whether or not to use diluted earnings per share.

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