On January 1, 2019 PaddyCake Corporation had 210,000 common shares outstanding. During 2019, it had the following transactions that affected the common share account:

February 1 Issued 160,000 common shares

March 1

April 1 Issued 55,000 more common shares

Issued a 20% stock dividend

May 1 Repurchased 100,000 common shares and retired them

June 1 Issued a 2 for 1 stock split

October 1 Issued 40,000 common shares

The company had the following two convertible securities outstanding:

8% convertible bonds, each $1,000 bond convertible into 15 common shares $3,000,000

6% convertible $100 par value preferred shares, each convertible to 2 common shares $500,000

Both convertible securities were issued at face value in 2019. The preferred shares are cumulative. No dividends were declared in 2019.

Assume that PaddyCake Corps had net income after tax of $3,525,000 during 2019. There was a discontinued loss before tax of $220,000.

The companys year-end is December 31. Assume a tax rate of 35%.

Required (Showing all work):

a) Determine the weighted average number of shares outstanding at December 31, 2019 (5 marks)

b) Calculate basic earnings per share. (4 marks)

c) Calculate the Diluted Earnings per share. (6 marks)