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Unformatted text preview: (b) Additionally, assume the preferred stock is convertible into 1,000,000 shares of common stock. Compute the company's diluted earnings per share. For this calculation, the numerator will be net income, as you will assume that the preferred dividend was not paid ("if" the preferred was converted to common, the preferred dividend would not have been paid). The denominator will be the weighted-average common shares plus the number of shares that would be issued on conversion (i.e., 1,000,000)....
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This note was uploaded on 02/29/2012 for the course ACCOUNTING 101 taught by Professor Hudack during the Spring '11 term at FIU.
- Spring '11