Bazar Tuan Padang Bhd reported a net income of RM4,500,000 for the year 2015. The company has 500 000 stock option plan for their employees. A privilege will be given to all employees with an exercise price of RM6 per share. Currently, the market price is RM7.50 per share. Assume all options are exercised on the exercise date.

The following is additional information obtained from Bazar Tuan Padang Bhd financial reports:

2 600 000 common stock at RM2 per share.

RM 600 000, 20% preferred stock.

RM 5 000 000, 7% convertible bonds converted into 600,000 shares of common stocks

35% income tax rate.

a) Calculate the diluted earnings per share.