PLEASE SEE BELOW 2 QUESTIONS. ALL ANSWERS SHOULD BE LENTHY AND ORIGINAL!

1. INTERMEDIATE ACCOUNTING QUESTION:

We will discuss share-based compensation and EPS during Week 5. Post your original response to the main question(s) by Thursday and reply to at least two other posts by Sunday. Posts such as "I agree" will not be counted toward the two responses needed to earn full points for the assignment.

The 2013 annual report ofBest Buy Co., Inc., reported profitable operations for the year. However, the company suffered a net loss in 2012. Best Buy reported the following for the twelve months ended March 3, 2012:

http://textflow.mheducation.com/figures/0077896041/unnumtab508.jpg (go to website to see table)

Note: The calculation of diluted earnings per share assumes the conversion of the company's previously outstanding convertible debentures due in 2022 into 8.8 million shares common stock and adds back the related after-tax interest expense of $1.5. The calculation of diluted (loss) per share for the twelve months ended March 3, 2012, does not include potential dilutive shares of common stock because their inclusion would be antidilutive (i.e., reduce the net loss per share).

Required:

1. The note indicates that Best Buy does not include potentially dilutive shares when calculating EPS for the twelve months ended March 3, 2012. What are potentially dilutive shares?
2. The note indicates that diluted earnings per share assumes the conversion of the company'spreviously outstandingconvertible debentures due in 2022 into 8.8 million shares common stock and adds back the related after-tax interest expense of $1.5. Apparently, these bonds were actually converted during the year. Would diluted EPS have been different if the bonds had not been converted and were still outstanding? Explain.
3. Best Buy does not include potentially dilutive shares when calculating EPS for the twelve months ended March 3, 2012. Why not? Assume Best Buy had 40 million common equivalent shares and included them in the calculation, what would have been the amount of diluted loss per share for the twelve months ended March 3, 2012?

2. TAX QUESTION:

What is a special district and why might a government create one or more special districts? In your hometown, what are examples of special districts?

Back up your answer with examples and also respond to posts made by your classmates prior to the due date. - (mine were very vague so make up any)