Study_Guide_-_Test_3_-_Chapters_19_20_and_21 - Study Guide...

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-Does the current FASB standard requires using intrinsic value accounting for employee stock options. - If previous experience indicates that a material number of stock options will be forfeited before they vest, the fair value estimate of the options on the grant date should be adjusted to reflect that expectation. -Must Compensation expense be adjusted during the service period to reflect changes in the fair value of options caused by changes in the market price of the underlying shares. - Do Current year stock dividends and splits require retroactive restatement of EPS for all prior years presented in comparative financial statements. -Is this a true statement and why? Stock options will be dilutive and included in the calculation of dilutive EPS if the exercise price is greater than the average market value of the stock. - Do Dilutive convertible bonds affect both the numerator and the denominator in computing diluted EPS or just one or the other?. - Except for tax considerations the potentially dilutive effect of convertible preferred stock is handled in EPS calculations in much the same way as convertible debt is this true or false and why? - Is time-weighting of contingently issuable shares required when computing basic EPS. -If a company's capital structure includes convertible bonds, diluted EPS might be reduced even if the bonds are not actually converted during the year WHY?. - If a company reports an extraordinary gain, EPS must be disclosed for both income from ordinary continuing operations and net income is this true or false and why? - Are all changes in accounting principle reported using the retrospective approach? - Are prior years' financial statements are restated when the prospective approach is used why or why not? - The after-tax cumulative effect on income is no longer required for changes in accounting principles True or false and explain. - All changes in accounting principle require a disclosure justifying the change in the first set of financial statements after the change is made. Is this statement True? - All changes reported using the retrospective approach require prior period adjustments. Is this true and why or why not?
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Study_Guide_-_Test_3_-_Chapters_19_20_and_21 - Study Guide...

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