what-is-the-effect-of-convertible-debt-and-employee-stock-options-on-diluted-eps

Question

What is the effect of convertible debt and employee stock options on diluted EPS?

Accepted Answer

They increase the number of shares, potentially reducing the EPS.

Answer

They have no impact on the number of shares or EPS.

Answer

They decrease the net income, potentially increasing the EPS.

Answer

They increase the preferred dividends, reducing the EPS.