An entity reported net income of EUR 250,000 for 2009. The entity had 125,000 ordinary shares of EUR 1 and 30,000 convertible preference shares of EUR 40 each outstanding during the year. The dividend rate on the preference shares is EUR 2 per share. Each convertible preference share can be converted into two shares of the entity’s ordinary shares. During 2009 no convertible preference shares were converted. 

(a) Determine the entity’s basic earnings per share. 

(b) Determine the entity’s diluted earnings per share.