the following are selected details of Kingston Objects Inc.'s capital structure as at January 1,2018

• 200,000 common shares issued and outstanding.
• 100,000 cumulative preferred shares "A" that are each entitled to dividends of $4 per annum
• 50,000, $100 non-cumulative shares "B" with a stated dividend rate of 3% per annum. At
• the option of the holder, each preferred share can be converted into two common shares on December 31, 2023.
• Bonds A - $1,000,000 6%, semi-annual bonds maturing December 31, 2022.
• Bonds B - $2,000,000, 5%, semi-annual bonds maturing June 30, 2028. At the option of
• the holder, each $1,000 bond can be converted into 10 common shares at any time between January 1, 2023, and December 21, 2023.
• Bonds C- $500,000, 3%, semi-annual bonds maturing December 21, 2023. At the option of
• the holder, each $1,000 bond can be converted into eight common shares.
• Option A-grants the holder the right to purchase 10,000 common shares at any time
• before December 31, 2021, for $20 per share.
• Option B-grants the holder the right to purchase 5,000 common shares for $12 per
• share. The option expires on December 21, 2019.

During the year, Kingston issued ordinary shares as follows:

• March 1, 2018 - issued (sold) 20,000 common shares.
• October 1, 2018 - issued (sold) 10,000 common shares.
• December 1, 2018 - declared and distributed a 20% stock dividend.

Kingston was subject to a 30% tax rate. Its net income for the year ended December 31, 2018, totaled $1,339,000. During the year, Kingston declared and paid the stated dividends on both classes of preferred shares as well as $200,000 of dividends on its common shares. The average market rate in 2018 for Kingston's common shares was $15.

The recorded exercise prices and number of shares under the stock options plans that can be acquired have already been adjusted for the stock dividend. Similarly, the recorded conversion

Factor for the convertible bonds and preferred shares have already been adjusted for the stock dividend.

Assume that the effective rate of interest on the bonds equals thebonds equals the coupon rate.

Required:

1. Calculate Kingston's basic EPS for the year ended December 21, 2018.
2. a schedule that sets out the income effect, share effect, and each security that is convertible into common shares. Rank each by their dilutiveness
3. Calculate Kingston's diluted EPS for the year ended December 31, 2018.