FHU Corp. had $812,000 net income in 2021. The tax rate is 28%. The information below pertains to the company in 2021: - 45,000 share options were granted in 2020, with each exercisable for one ordinary share at $30. The market price of the ordinary shares averaged $50 during 2021. No option was exercised in 2021. During 2021, there were 40,000 shares of convertible preference shares outstanding. The preference share is $100 par, 2% cumulative, and is convertible into two ordinary shares. FHU issued $2,400,000 of 4% convertible bonds on September 30, 2021. Each $1,200 bond is 2 convertible into 30 ordinary shares. The liability component of the bonds is $2,000,000 based on a market rate of interest of 5%. There were no changes during 2021 in the number of ordinary shares outstanding. No conversion occurred in 2021. Required (Round to the third decimal point) a. Assuming that the weighted number of ordinary shares outstanding is 356,000, compute the basic earnings per share for 2021 and complete Schedule 1. (4 marks) b. Continued with a. Compute diluted earnings per share for 2021, including completing Schedule 2 and Schedule 3 in your answer book/file. (16 marks) controversy. C. Discuss the controversy involving share compensation plans and your standpoint as to the (8 marks) Schedule 1 Numerator Denominator Basic EPS Computation: Schedule 2 Effect on Income No. of shares Per share effect Rank Options Preference Bonds Computation: Schedule 3 1 2 3 Computation Diluted EPS = Numerator Denominator Temporary Diluted EPS