As of January 1, 20X2, BLH Corporation had 30,000 shares of $1 par common stock and 1,000 shares of $100 par 16% convertible, cumulative preferred stock outstanding. Each share of preferred stock is convertible into 2 shares of common stock. In addition, BLH had issued $1,000,000 9% non-convertible 10-year debentures in 20X1 at par. The company had issued stock options in 20X0 to its management personnel permitting them to acquire 6,000 shares of common stock at $10 per share. At the time of the option issuance, common stock was selling for $10 per share. The following events occurred during 20X2: On July 1, 20X2, the company issued $1,000,000 of 8% convertible 5-year bonds. Each $1000 bond is convertible into 10 shares of common stock. On September 30, 20X2, the company issued 30,000 shares of common stock. BLH reported net income of $340,000 in 20X2. The companys income tax rate was 40%. The average price of the common stock during 20X2 was $30.

a.What is the numerator (the top of the fraction) that is used in the calculation of Basic EPS? (Round your answer to the nearest dollar and do not use commas or dollar signs in your answer.)

b.What is the numerator in the Incremental EPS for the convertible bonds?

c.Which securities are included in the final calculation of Diluted EPS? Answer Choices:

-options

-8% Convertible Bonds

-9% Non-Convertible Bonds

-16% Convertible Preferred Stock

-None of the above