Sweet Horizon Corp had the following items, all of which were outstanding throughout the entire fiscal year ending September 30, 2021:

		750,000 common shares
		290,000 $3 cumulative, no-par value preferred shares
		Options to purchase 110,000 common shares at $13 per share. The average market price of Sweets common shares during the year was $20 per share. None of the options were exercised or expired during fiscal 2021
		9% bond with a face value of $2,000,000, convertible to 55,000 common shares.

Sweets net income for fiscal 2021 was $7,995,000, and its tax rate was 15%. Preferred dividends had been paid in all previous fiscal years.

Calculate the income effect of the dividends on preferred shares.

Dividends on preferred shares

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Calculate Sweets basic earnings per share for the year. (For simplicity, ignore the requirement to record the debt and equity portions of the convertible bond separately).

Basic earnings per share

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Calculate the after-tax interest paid on the 9% bonds.

After-tax interest on bonds converted

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Determine an incremental per share effect for 9% bonds.

Potentially dilutive security		Incremental Numerator Effect		Incremental Denominator Effect		EPS
9% Bonds		$				$

Calculate the proceeds from assumed exercise of options.

Proceeds from exercise of options

$

Calculate the incremental shares oustanding upon the exercise of options.

The incremental shares oustanding upon the exercise of options

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Rank the potentially dilutive securities from most dilutive to least dilutive.

9% bonds		Rank 1Rank 2Anti-dilutive
Options		Rank 1Rank 2Anti-dilutive

Calculate Sweets diluted earnings per share for the year.

		Numerator		Denominator		EPS
Basic EPS		$				$
9% bondsOptions
Sub Total						$
9% bondsOptions
Sub Total		$				$

Diluted EPS