Harvey Inc. has 3,000,000 shares of $1 par value common stock outstanding at January 1. On July 1, Harvey repurchased 300,000 shares at a cost of $21 per share. In addition, at December 31, 2018, 250,000 shares were issuable upon exercise of executive stock options which an exercise price of $20 per share. The average market price of the companys stock was $25 per share. Harvey Inc. also has two convertible securities. a. Convertible bonds, $4,000,000 face value, 6% interest, convertible into 80,000 shares of common stock. b. 40,000 shares of $100 par value convertible preferred stock with a dividend rate of 6%. Each $100 par value share is convertible into 8 shares each. During 2018, Harveys net income was $7,200,000 and all preferred stock dividends were declared and paid. The companys tax rate is 30%.

Compute the diluted earnings per share for 2018.