Scoring: IMP
You reach 7NT played by North. The bidding is unimportant, but it might go like this:
South North
1♣ 2♠
3♦ 3♥
4♣ 4NT (RKCB)
5♠ 5NT (No. side K's)
6♥ 7NT - All Pass
East leads a diamond. You win the A, cross to hand with a club, cash ONE spade, throwing a diamond from dummy (optional, but more than one would squeeze the dummy). You have 12 high card tricks, and the 13th can come in spades, hearts, or clubs, plus there are squeeze possibilities up the wazoo.
First, which entry do you use to the clubs?
Second, how do you continue if East shows out of on the third club? If West shows out?
Third, is there a 100% line?
In answer to the first question, it looks right to play the diamond now, keeping the finesse opportunity intact. However, the heart is the percentage play. To see why, let's do an analysis starting with the heart and then looking at the diamond play. If you want to skip the analysis, I offer an intuitive argument that you could use at the table, in real time, to find the best play.
Suppose you play a heart to the K. Assume all have followed low so far. You cash two more clubs, discarding spades from hand. If both follow, you have your 13th trick and can claim. So what happens if East shows out on the third club?
Let's say East throws a diamond. Cash the last high club, East throwing another diamond. Get back to hand with a heart and cash the third heart (if you haven't already done so). You succeed when either major is 3-3, or the ♥J falls, or East holds exactly 4 spades and 5 diamonds, when East is squeezed. You also succeed when East holds both red suits. West must guard both black suits, so will have to discard a diamond from 4-4-3-2, giving you a double squeeze, or you have a simple squeeze on East if East started with 5 diamonds. However, you fail if East holds length in both majors, or if East has 5 spades and 4 diamonds, as long as West holds the Q, J, or 9 (East discards a spade and 2 diamonds, and West keeps the third diamond behind dummy).
So far not looking so good for this line, but let's see what happens if West shows out on the third club. If East holds length in spades as well, he is squeezed in the black suits on the play of hearts. If East holds the long hearts and West the spades, either West is squeezed in spades and diamonds or there is a double squeeze. Say West started 5-2-4-2. West can throw a spade and a diamond on the clubs, but must discard another diamond on the third heart. Now cash a top spade. Poor East is squeezed in three suits. A heart or club is immediately fatal, so East discards a diamond, but now you come down to ♦K7 in the dummy. The 8 to the K pulls the remaining diamonds, and the ♦7 is the fulfilling trick.
If East holds length in both minors, then East is squeezed in the minors, which may in fact be a double squeeze (West must discard a diamond from 4-4-3-2). And again, you give up nothing if either major is 3-3 or the♥J falls. So the heart to the K is 100% certain if East has the long clubs.
Now, going back to the diamond line. How does this compare when East shows out of clubs? When West shows out?
Well, you certainly gain when East holds both majors, since you cash all of dummy's minor honors to squeeze East, and you don't lose if East has both reds either. You don't have any more squeezes, but when you cash out the black suits and see East throwing diamonds, you have near certainty that the heart finesse is working. You DO lose in the specific case of East holding 4-5 (or longer) ♠-♦, since you no longer have the entries to squeeze East in these suits. Overall, diamond to the K first works better if East has short clubs.
Now let's look at this second line when West has short clubs. Remember, the first line was 100% in this case. The second line, not so. You've lost the ability to play for the double squeeze, so all you have is the simple squeeze on West in the majors or in ♠-♦ and the regular breaks. This means that you will go down whenever West started with ♥-♦ and also when West started ♠-♦ as long as East has three diamonds, one of them being the Q, J, or 9.
So overall, while both lines have excellent chances of success, the heart line is slightly better.
Now for the intuitive argument. You should use the heart entry first, because the heart suit has a chance of producing the 13th trick on its own, while the diamond suit does not, and this chance isn't greatly reduced by giving up the heart finesse (the chance of the J falling is 50% a-priori). Therefore, when all the normal plays have been exhausted, you will need the diamond K as an entry so that dummy's threats - in hearts, clubs, AND diamonds, stay active as long as possible.

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