#4 Ruger Inc. had reported net income of $1,500,000 in Year 1. Ruger had 250,000 shares of non cumulative convertible preferred stock and 200,000 shares of common stock outstanding for the entire year. Each share of preferred stock is convertible into 2 shares of common. Ruger declared and paid a $25,000 preferred dividend and a $50,000 common dividend. Ruger has a 40% tax rate. The firms Year 1 diluted earnings per share is approximately (Round to the nearest penny).

The correct answer should be $2.14!