Peters Corp.s capital structure was as follows:

	December 31
	Year 7	Year 8
Outstanding shares of stock:
Common	100,000	100,000
Convertible preferred	10,000	10,000
9% convertible bonds	$1,000,000	$1,000,000

During Year 8, Peters declared and paid dividends of $3.00 per share on its preferred stock. The preferred shares are convertible into 20,000 shares of common stock, and the 9% bonds are convertible into 30,000 shares of common stock. Assume that the income tax rate is 30%.

If net income for Year 8 is $245,000, Peters should report DEPS as

$2.04

$2.15

$2.14

$2.05