When a firm has securities outstanding that, if exchanged for shares of common stock, would decrease basic earnings per share by _____ or more, generally accepted accounting principles require a dual presentation: basic earnings per share and diluted earnings per share.
A)1 percent
B)3 percent
C)10 percent
D)20 percent
E)30 percent

Question

Quizplus · Accepted Answer

Generally accepted accounting principles require a dual presentation of basic earnings per share and diluted earnings per share when securities outstanding could decrease basic EPS by 3 percent or more.

When a Firm Has Securities Outstanding That, If Exchanged for Shares