Financial Statement Analysis for Earnings Per Share (EPS): A company reported net income of $200,000 and had 50,000 common shares outstanding during the year. Additionally, the company issued 5,000 preferred shares that are convertible into common shares. Calculate the company's basic and diluted earnings per share (EPS) and discuss how diluted EPS reflects the potential dilution of existing shareholders' ownership interests. Analyze the implications of convertible securities on EPS and shareholder value.