On January 1, 2020, Ehrlich had outstanding 250,000 shares of $2 par value common stock and 10,000 shares of 8%, $50 par value, cumulative preferred stock. Each share of preferred stock is convertible into 2 shares of common stock.

During 2020, Ehrlich had the following transactions with regards to its common stock:

3/1purchased 20,000 shares of its common stock

7/1Declared a 2-for-1 stock split

9/1issued 15,000 shares of its common stock

During 2020, Ehrlich declared and paid the dividend on its preferred stock .

During 2020, Ehrlich earned net income of $850,000.

INSTRUCTIONS:

a.Determine the weighted average number of shares outstanding.

b.Determine the corporations basic earnings per share.

c.Determine the corporations diluted earnings per share.

On January 1, 2020, Ehrlich had outstanding 250,000 shares of $2 par value common stock and 10,000 shares of 8%, $50 par value, cumulative preferred stock. Each share of preferred stock is convertible into 2 shares of common stock. During 2020, Ehrlich had the following transactions with regards to its common stock: 3/1 purchased 20,000 shares of its common stock 7/1 Declared a 2-for-1 stock split 9/1 issued 15,000 shares of its common stock During 2020, Ehrlich declared and paid the dividend on its preferred stock During 2020, Ehrlich earned net income of $850,000. INSTRUCTIONS: a. Determine the weighted average number of shares outstanding. b. Determine the corporation's basic earnings per share. c. Determine the corporation's diluted earnings per share