The two ways that earnings per share can be reported are ______.Multiple select question.commonbasicdilutedpreferred

Answering the Question

When it comes to reporting earnings per share (EPS), the two primary ways are:

1. Basic Earnings Per Share - This calculation considers only the net income available to common shareholders divided by the weighted average number of common shares outstanding during the period. It does not account for any potential dilution from convertible securities.

2. Diluted Earnings Per Share - This measure includes the effect of all dilutive potential common shares, such as convertible preferred stocks, convertible debt, and stock options. It provides a worst-case scenario for earnings per share, reflecting the potential impact of converting these financial instruments into common shares.

Therefore, for the multiple select question, the correct answers are basic and diluted.