- CFA Exams
- CFA Level I Exam
- Study Session 7. Financial Reporting and Analysis (2)
- Reading 21. Understanding Income Statements
- Subject 7. Earnings per Share
CFA Practice Question
Which of the following securities would NOT be found in a simple capital structure?
A. 3% $100 par value convertible preferred
B. 6% $5000 par value general obligation bond
C. 8% $1000 par value callable mortgage bond
Explanation: A simple capital structure contains no potentially dilutive securities such as options, warrants, common stock or convertible preferred securities.
User Contributed Comments 2
| User | Comment |
|---|---|
| danlan | C is callable debt and not call option for equity, so it does not affect number of common shares. |
| tankdan | Somehow missed the NOT.... |