Hanson Co. had 200,000 shares of common stock, 20,000 shares of convertible preferred stock, and $1,000,000 of 6% convertible bonds outstanding during 2015. The preferred stock is convertible into 40,000 shares of common stock. During 2015, Hanson paid dividends of $.60 per share on the common stock and $1.50 per share on the preferred stock. Each $1,000 bond is convertible into 40 shares of common stock. The net income for 2015 was $400,000 and the income tax rate was 30%.

Basic earnings per share for 2015 is (rounded to the nearest penny)

a. $1.57.

b. $1.71.

c. $1.80.

d. $1.85.

Diluted earnings per share for 2015 is (rounded to the nearest penny)

a. $1.41.

b. $1.49.

c. $1.53.

d. $1.58.