Assume that the above subsidiary reported net income of $105,000 and had 1200 convertible bonds payable outstanding. In addition, the subsidiary had 5,000 shares of cumulative 8%, $100 par value preferred stock. The bonds pay 2% interest annually and mature in 2020. Further assume that the bonds are convertible at the rate of 100 shares of $10 par value stock per bond. The stocks market value is $12 per share. Calculate diluted earnings per share. The marginal tax rate is 30%.