Consider the following information for Wichtel Corporation. Assume that the weighted average shares were 500,000 shares.

Preferred Stock:

5%, $100 par convertible cumulative preferred stock issued at par, convertible into 20,000 shares of common stock $200,000

6%, $100 non convertible cumulative preferred stock issued at $102;$300,000

Stock options50,000 shares

Option Exercise Price$20 per share

Average market price$31

Year-end market price$28

Bonds:

• 8%, $1,000 par, issued at par, convertible into 16,000 shares of common stock$200,000
• 9%, $1,000 par, issued at par, convertible into 7,000 shares of common stock $100,000.

Net income for year is $400,000. The company's tax rate is 35%.No actual conversions occurred and no options were exercised during the year.

Required:

1. Compute basic earnings per share

Basic EPS = ______________________________________________

2. Compute diluted earnings per share

Diluted EPS = _________________________________________________