Basic and Diluted Earnings Per Share Assume that the following data relate to Rosen, Inc. for the year 2015: Net income (30% tax rate) $3,500,000 Average common shares outstanding 2015 1,000,000 shares 10% cumulative convertible preferred stock: Convertible into 80,000 shares of common $1,600,000 8% convertible bonds; convertible into 75,000 shares of common $2,500,000 Instructions a) Compute basic earnings per share. b) Calculate whether or not the assumed conversion of the preferred stock or the convertible bonds would be dilutive or anti-dilutive (calculate each of these individually). c) Calculate diluted earnings per share assuming the conversion of the preferred stock