Information from the financial statements of Ames Fabricators, Incorporated included the following:

December 31 2024 and 2023

Common shares 100,000 100,000

Convertible preferred shares (convertible into 32,000 shares of common) 12,000 12,000

8% convertible bonds (convertible into 30,000 shares of common) $ 1,000,000 $ 1,000,000

Amess net income for the year ended December 31, 2024, is $500,000. The income tax rate is 25%. Ames paid dividends of $5 per share on its preferred stock during 2024.

Required: Compute basic and diluted earnings per share for the year ended December 31, 2024.