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When computing the weighted-average number of shares outstanding during the year for the purpose of calculating diluted EPS, what is the proper treatment of a midyear issuance of securities convertible to common stock?

a) The issuance should be treated as having occurred at the beginning of the year.

b) No shares should be considered outstanding until the time of actual conversion.

c) A retroactive adjustment of the change in capital structure to the beginning of the earliest period presented is necessary.

d) Conversion is assumed to have occurred at the date of issuance.

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M9409995

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