A company's net income in 2017 was $4 Billion.

It paid interest of $1 billion, preferred dividends of $500 million, and common dividends of $1.5 billion in 2017.

The company had 1.25 billion common shares outstanding throughout 2017, and has granted 100 million stock options to its executives, none of which had been exercised at the end of 2017.

Calculate basic EPS and diluted EPS.

• Please let me know if the answers below are right/wrong, and if wrong, please explain where I went wrong. Thanks!

Basic EPS

($4B - 500M) / (1.25B) = $2.80/share

Dilluted EPS

($4B - 500M) / (1.25B + 100M stock options) = $2.59/share