At December 31, year 1, the Merlin Company had 50,000 shares of common stock issued and outstanding. On April 1, year 2, an additional 10,000 shares of common stock were issued. Merlin's net income for the year ended December 31, year 2, was $172,500. During year 2, Merlin declared and paid $100,000 cash dividends on its nonconvertible preferred stock. The basic earnings per common share, rounded to the nearest penny, for the year ended December 31, year 2, should be $3.00 $1.32 $1.26 $3.14