On December 31, 2020, Company A had outstanding 800,000 shares of common stock and 80,000 shares of 9% cumulative preferred stock (par $50).

January 31, 2021, issued an additional 72,000 shares of common stock

July 1, 2021, 36,000 shares were retired.

A 14% stock dividend was declared and distributed on June 1, 2021.

At year-end, there were fully vested incentive stock options outstanding for 120,000 shares of common stock (adjusted for the stock dividend). The exercise price was $26. The market price of the common stock averaged $32 during the year.

Also outstanding were $1,000,000 face amount of 6% convertible bonds issued in 2018 at par. Each $1,000 bond was convertible into 45 common shares (adjusted for the stock dividend).

Net income was $1,800,000. The tax rate for the year was 40%.

Required:

Compute basic and diluted EPS