Which of the following would not be used in computing diluted earnings per share?

Question

Quizplus · Accepted Answer

Preferred stock is not used in computing diluted earnings per share because it does not have the potential to be converted into common stock. Diluted earnings per share calculations only consider securities that have the potential to be converted into common stock, such as convertible bonds and stock options. The weighted-average number of shares of common stock outstanding during the year is also used in calculating diluted earnings per share.

Which of the Following Would Not Be Used in Computing