Primary EPS is changed to fully diluted EPS for outstanding convertible bonds by Adding to the...

Question

Question

Primary EPS is changed to fully diluted EPS for outstanding convertible bonds by
1. Adding to the denominator the shares the bonds can be converted into
2. Adding to the numerator the interest expense on the bonds, net of tax savings from the bonds interest expense
3. Convertible bonds are not considered when computing fully diluted EPS
4. Both a and b are used in the computation of fully diluted EPS
Which of the following is considered a pervasive constraint by Statement of Financial Accounting Concepts No. 8
1. Costs of providing the disclosure
2. Conservatism
3. Timeliness
4. Verifiability

Answer 1

Answer #1

Solution Primary EPS is changed to fully diluted EPS for outstanding convertible bonds by -Adding to the denominator the shar

Answer 2

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