A section of the balance sheet of Delta Corporation is provided below.

Delta Corporation

Selected Balance Sheet Information

At December 31, 2018

Long-Term Debt:

Notes Payable, 10%$2,000,000

12% Convertible Bonds Payable6,000,000

Total Long-Term Debt$8,000,000

Shareholders Equity:

$5 cumulative dividend, convertible preferred shares, no par

value; 200,000 shares authorized, 120,000 shares issued

and outstanding$4,500,000

Common Shares, no par value; 5,200,000 shares authorized,

1,500,000 shares issued and outstanding1,500,000

Contributed Surplus3,400,000

Retained Earnings 6,500,000

Total Shareholders Equity $15,900,000

Notes and Assumptions

December 31, 2018

• Options were granted/written in December 2016 to purchase 60,000 common shares at $25 per share.The average market price of Deltas common shares during 2018 was $30 per common share.The options expire in 2020 and no options were exercised during 2018.
• The 12% bonds were issued in 2017 at face value.Each convertible bond is convertible into 50 common shares (each bond has a face value of $1,000).
• The $5 cumulative, convertible preferred shares were issued at the beginning of 2016.Each preferred share is convertible into 3 common shares.
• The average income tax rate is 40%.
• The 1,500,000 common shares were issued at $1 per share and were outstanding during the entire year.
• Preferred dividends were not declared in 2018.
• Net income was $4,200,000 in 2018.
• No bonds or preferred shares were converted during 2018.

Required:(Show all calculations)

• Calculate basic earnings per share for Delta for 2018.
• Calculate diluted earnings per share for Delta for 2018 by following the proper steps.
• Show the presentation of earnings per share for Delta for 2018.