Below are the # for Dow Steel Corporation. I need to compute their basic and diluted EPS for December 31st 2021 but I do not know which # to use for the numerator and denominator and I am hoping to get someone to walk me through how to determine that.

Numerator/Denominator=Earnings per share

Dow's basic/=

Dow's diluted/=

On December 31, 2020, Dow Steel Corporation had 640,000 shares of common stock and 304,000 shares of 8%, noncumulative, nonconvertible preferred stock issued and outstanding. Dow issued a 4% common stock dividend on May 15 and paid cash dividends of $440,000 and $73,000 to common and preferred shareholders, respectively, on December 15, 2021. On February 28, 2021, Dow sold 57,000 common shares. In keeping with its long-term share repurchase plan, 6,000 shares were retired on July1. Dow's net income for the year ended December 31, 2021, was $2,300,000. The income tax rate is 25%. Also, as a part of a 2020 agreement for the acquisition of Merrill Cable Company, another 27,000 shares [already adjusted for the stock dividend] are to be issued to former Merrill shareholders on December 31, 2022, if Merrill's 2022 net income is at least $540,000. In 2021, Merrill's net income was $670,000. As part of an incentive compensation plan, Dow granted incentive stock options to division managers at December 31 of the current and each of the previous two years. Each option permits its holder to buy one share of common stock at an exercise price equal to market value at the date of grant and can be exercised one year from that date. Information concerning the number of options granted and common share prices follows: 0P1: iune Granted Date Granted {adjusted for the stock dividend] Share Price December 31, 2019 11,000 $ 14 December 31, 2020 6,000 5 23 December 31, 2021 9,500 $ 22 The market price of the common stock averaged $22 per share during 2021. On July 12. 2019, Dow issued $800,000 of convertible 8% bonds at face value. Each $1,000 bond is convertible into 35 common shares (adjusted for the stock dividend]