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26. 26. A company is calculating its diluted earnings per share for year 202 1. The only potentially diluting instrument that the company has is

26.
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26. A company is calculating its diluted earnings per share for year 202 1. The only potentially diluting instrument that the company has is preferred shares convertibles. These shares were issued on May 1, 2021. When calculating the denominator of diluted profit, the company: to. It will presume that the preferred shares were converted to common shares on January 1, 2021. b. It will presume that the preferred shares were converted to common shares on May 1, 2021. C. You cannot presume that they were converted into common shares, because the shares are not existed on January 1, 2021. Therefore, it will not present diluted profit. d. When potentially diluting instruments are issued after the start of the year it is always presumed that they will be anti-diluent

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