Information concerning the capital structure of Dean Corporation follows:

		December 31,
	Y4	Y3
Common shares outstanding	100,000 shares	100,000 shares
Convertible preferred shares outstanding	10,000 shares	10,000 shares
9% convertible bonds	$2,000,000	$2,000,000

During Y4, Shepherd paid dividends of $1.00 per common share and $2.50 per preferred share. The preferred shares are non-cumulative, and convertible into 20,000 common shares. The 9% convertible bonds are convertible into 50,000 common shares. Net income for calendar Y4 was $500,000. Assume the income tax rate is 30%. Basic earnings per share for Y4 is

Question 7 options:

	$0.04
	$5.00
	$3.65
	$4.75