[JoeL]

if the convertible preferred stock or convertible bond is issued at mid-year, for instance, June 30. Are the if-converted cs shares treated at mid-year or beginning of year?

For instance: a 1000 bond issued on June 30 is convertible to 10 shares of cs

Under if-converted method, should I add 10 shares or 5 shares to calculate the Diluted EPS?????

I found something in ASC, it says “This method assumes that convertible securities are converted at the beginning of the fiscal period or at the time of issuance, whichever is later.”

Please help, this may be helpful to you.

[MCLKT]

I've found in the problems for EPS the shares aren't actually converted at a set date. They are just convertible, and you have to know for the diluted method to convert when calculating the common stock equivalent number.

For your example: 10

A:[73]97 F:[74]85 R:86 B:[74]82
*NINJA 10 Pt. COMBO & Yaeger*

[Anonymous]

Yes, the if-converted is used to calculate diluted EPS and would be calculated as if they were converted in the beginning of the year.

[Author]

Replies