Inco has 3,600,000 shares of common stock outstanding on January 1. An additional 300,000

shares of common stock were issued on July 1, and 600,000 more on October 1. On April 1, it

issued 6,000, $1,000 face value, 4% convertible bonds. Each bond is convertible into 80 shares

of common stock. No bonds were converted into common stock that year. What is the number

of shares to be used in computing basic earnings per share and diluted earnings per share,

respectively, for the year ended December 31?

a.

3,900,000 and 3,900,000

b.

3,900,000 and 4,260,000

c.

3,900,000 and 4,380,000

d.

4,500,000 and 4,860,000