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.

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This statement is true. The dilutive effect of convertible preferred stock is factored into the EPS calculation using the treasury stock method, which is the same method used for convertible debt. However, tax considerations may affect the calculation of diluted EPS for convertible preferred stock.

Except for Tax Considerations the Potentially Dilutive Effect of Convertible