Pacific Sailing Co.'s (PSC) net income in 2020 was $600,000, and its tax rate was 25%. The company had 150,000 shares of common stock outstanding throughout 2020.

On January 1, 2020, PSC issued $1,200,000 of 5% convertible preferred stock. Each $100 preferred share is convertible into 1 share of PSC common stock. None of the preferred shares were converted in 2020.

Compute diluted earnings per share for 2020.