Diluted earnings per share assume the conversion or exercise of all potentially dilutive securities at the beginning of the period.

Question

Quizplus · Accepted Answer

Diluted earnings per share calculations assume that all potentially dilutive securities, such as stock options, convertible debt, or warrants, are exercised or converted at the beginning of the reporting period. This results in a more accurate representation of earnings per share if these securities were to be converted or exercised. Therefore, the statement is true.

Diluted Earnings Per Share Assume the Conversion or Exercise of All