The following additional information is available: a)On September 1, 2021, Baxley sold 56,000 additional shares of common stock. b)Net income for the year ended December 31, 2021, was $860,000. c)During 2021, Baxley declared and paid dividends of $5 per share on its preferred stock. d)The 10% bonds are convertible into 40 shares of common stock for each $1,000 bond. e)Unexercised options to purchase 30,000 shares of common stock at $22.50 per share were outstanding at the beginning and end of 2021. f)Options to purchase 20,000 shares of common stock at $38 per share were outstanding for all of 2021. g)The average market price of Baxleys common stock during 2021 was $36 per share. h)Baxleys effective tax rate was 30%.

INSTRUCTIONS: Compute basic EPS and diluted EPS for 2021.

2. 2