7.lf preferred stock is cumulative and no dividends are deciared, the y subtracts the current year preferred dividend in computing earnings per share.(TRUE FALSE 8. When stock dividends or stock splits occur, companies must restate the shares outstand- ing after the stock dividend or split, in order to compute the weighted-average number of shares. TRUE FALSE 9. Dilutive convertible bonds affect both the numerator and the denominator in computing diluted EPS. TRUE FALSE 10. Stock options will be dilutive and included in the calculation of dilutive EPS if the exercise price is greater than the average market value of the stock. TRUE FALSE 11.In stock option, compensation is measured as the book value of the stock option at the grant date and then debited to compensation expense and credited to stock option for the total mount. TRUE FALSE 12. Total compensation as estimated by the option pricing model is reported as compensation expense over the service period for which the option was give. TRUE FALSE