Information concerning the capital structure of the Petrock Corp. includes: Common stock 90,000; Convertible preferred stock 10,000 shares; and 8% convertible bonds $1,000,000. All of these securities were outstanding on 31/12/20X1 and 31/12/20X2. During 20X2, Petrock paid dividends of $1 per share on its common stock and $2.40 per share on its preferred stock. The preferred stock is convertible into 20,000 shares of common stock. The 8% convertible bonds are convertible into 30,000 shares of common stock. The net income for the year ending December 31, 20X2, was $285,000. Assume that the income tax rate is 30%. What should be the diluted EPS for the year ending December 31, 20X2, rounded to the nearest penny?

Select one:

a.$2.21

b.$2.61

c.$2.78

d.$2.44