Which of the Following Is Correct Regarding Earnings Per Share

question 26

Multiple Choice

Which of the following is correct regarding earnings per share (EPS) ?

• A) If preferred stock is outstanding,dividends declared on the preferred stock are always deducted from net income in calculating EPS.
• B) EPS can never be negative.
• C) All issues of convertible to common stock must be included in the calculation of diluted EPS.
• D) If income from continuing operations is less than zero,potentially dilutive securities are anti-dilutive.

---

Definitions:

Pulmonary Edema

The accumulation of fluid in the lungs' air sacs, leading to breathing difficulties.

Respiratory Membrane

The thin barrier through which gas exchange occurs between the alveolar air and the blood in the lungs.

Alveolar Epithelium

The thin layer of cells that lines the alveoli (air sacs) in the lungs, playing a key role in the exchange of oxygen and carbon dioxide.

Vital Capacity

Greatest volume of air that can be exhaled from the lungs after a maximum inspiration.