Public company reporting and earnings per share

FAR Chapter 7 · Area I · Blueprint I.D

Companies with publicly traded shares answer to the SEC as well as to GAAP. The Blueprint asks you to recall the purpose and key items of Forms 10-K, 10-Q and 8-K, and to calculate basic and diluted earnings per share. EPS is one of the most calculation-heavy topics in Area I and a regular simulation. The method never changes: get the numerator, get the weighted shares, then test each dilutive security.

In this chapter

SEC reporting: the three forms
Filing deadlines
Basic earnings per share
Diluted EPS: options and the treasury stock method
Diluted EPS: convertibles and the if-converted method
The antidilution test
Presentation and other EPS points

This chapter has 7 lessons, 52 practice MCQs with explanations and 10 simulations, plus flashcards and a recall sheet.

What this chapter covers

Forms 10-K, 10-Q and 8-K and their key items
basic and diluted EPS with options, preferred stock and convertibles

Chapter 6: State and local government concepts · Chapter 8: Special purpose frameworks