In computing Primary EPS and Fully Diluted EPS, convertible securities are treated as being converted at the beginning of the period (or when issued, if issued during the period). On the assumption that these securities were converted, the company would not pay interest charges or preferred dividends on them. So an adjustment must be added back to Income Available for Common Shareholders (v1850) for interest charges (net of tax) and preferred dividends related to the common stock equivalents (for Primary EPS) or all dilutive securities (for Fully Diluted EPS).
The number of Common Stock Equivalents or Potentially Dilutive Securities (v3420 or v3430) is added to the Number of Common Shares: Weighted Average (v3410) in calculating Primary EPS (v6130) or Fully Diluted EPS (v6135).
Primary or Fully Diluted EPS =
Adjusted Number of Shares
Adjusted Income and Adjusted Number of Shares are calculated as follows:
Adjusted Income = (v1850.00) + (v3450.00)
(v1850.00) Income Available for Common Shareholders
(v3450.00) Fully Diluted EPS Adj. to Net Income
Adjusted Number of Shares = (v3410.00) + (v3420.00 or v3430.00)
(v3410.00) Number of Common Shares: Wtd. Avg.
(v3420.00) Common Stock Equivalents
(v3430.00) Potentially Dilutive Securities