Ask Question
BusinessBusiness
17 February, 17:21

If convertible bonds were issued at a discount, when computing diluted EPS, the amortization of the bond discount: Multiple Choice Will increase the numerator. Will decrease the numerator. Will have no effect. May increase or decrease the numerator, depending on the amortization method used.

+5
Answers (1)
  1. 17 February, 17:26
    0
    Answer: Option 1

    Explanation:

    If the convertible bonds are issued at discount then it will increase the numerator. Convertible bonds yields a fixed interest income. When the convertible bonds are issued at a discount then they can be converted into shares and discount is considered in the purchasing price of the stock.

    In amortized bond the each payment goes towards the interest as well as the principle amount. Amortization reduces the credit risk as the principle is repaid on maturity or on default of the firm.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “If convertible bonds were issued at a discount, when computing diluted EPS, the amortization of the bond discount: Multiple Choice Will ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers
You Might be Interested in
Calculate the fair present values of the following bonds, all of which pay interest semiannually, have a face value of $1,000, have 10 years remaining to maturity, and have a required rate of return of 15.5 percent. a. The bond has a 7.
Answers (1)
ACB Company sells Product X for $20 per unit, but if the product is enhanced, it can be sold for $26 per unit. The enhancement process will cost $80,000 for the 10,000 units that are currently sold.
Answers (1)
Military bases have been an important source of economic development in texas since
Answers (1)
Cook's Department Store advertises that it maintains a barbershop in its store and that the shop is managed by Hunter, a Cook's employee. Actually, Hunter is not an employee of the store but merely rents space in the store.
Answers (1)
As of January 1 of the current year, Grackle Company had accounts receivable of $50,000. The sales for January, February, and March were $120,000, $140,000, and $150,000, respectively. Of each month's sales, 20% are for cash.
Answers (1)
New Questions in Business
Which of the following characteristics would lead the auditor to assess control risk at a higher level? a. It is difficult for the auditor to determine or gain access to the organization or individuals who own and/or control the entity. b.
Answers (1)
The reason for the Fed being set up as an independent agency of government is to:
Answers (1)
Headings in reports that describe the content of the section and may even give a conclusion about the section are called:
Answers (1)
Coronado Company purchased land for $80,000. The company also paid $12,000 in accrued taxes on the property, incurred $5,000 to remove an old building, and received $2,000 from the salvage of the old building.
Answers (1)
Trueview video ads can be especially effective for driving what goals?
Answers (1)
Home » Business » If convertible bonds were issued at a discount, when computing diluted EPS, the amortization of the bond discount: Multiple Choice Will increase the numerator. Will decrease the numerator. Will have no effect.
Sign Up Forgot Password?