SIE Exam Question 679: Answer and Explanation

Question: 679

Which of the following is the measure of a company's earnings per share if all convertible securities were exercised and converted to common stock?

• A. Converted earnings per share
• B. Conversion ratio per share
• C. Diluted earnings per share
• D. Price/earnings per share

Correct Answer: C

Explanation:

Diluted earnings per share is the measure of a company's earnings per share if all convertible securities were exercised and converted to common stock.