During 2006, Ellis Corp. had 370,000 shares of $20 par common stock outstanding. On January 1, 2006, 2,000 bonds (stated rate, 8%) were issued with a maturity value of $1,000 each. To enhance the bond sale, the company offered a conversion of 50 shares of common stock for each bond at the option of the purchaser. Net income for 2006 was $464,000. The income tax rate was 30 percent. Compute the diluted earnings per share