Which statement would be most consistent with the Treasury Stock Method of calculating diluted earnings per share: The current market price of a Company's common shares has no bearing on the calculation of earnings per share. The best possible investment for a company is in its own common shares. The main concern with the Treasury Stock Method is that it is always anti-dilutive to per share earnings. It is more conservative to use basic shares outstanding than diluted share outstanding when calculating EPS.
Added by Aaron B.
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The Treasury Stock Method is used to calculate diluted earnings per share by assuming that any proceeds from the exercise of stock options or warrants will be used to repurchase common shares at the current market price. Show more…
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