The following data are presented by Quartz Corp. for calendar 2022

Net income $ 2,250,000

Common shares outstanding, 1,000,000 shares

10%, cumulative preferred shares, convertible into 100,000 common shares $ 1,600,000

6% convertible bonds; convertible into 110,000 common shares $ 6,000,000

360,000 call options exercisable at $ 20 per share

Additional information

1. The common and preferred shares and the convertible bonds were outstanding from the beginning of the year.

2. In 2022, a $ 500,000 dividend was declared and distributed; however, no dividends were declared in 2021.

3. The average market price of the common shares in 2022 was $ 25. The stock price was $ 22 on January 1, 2022, and $ 30 on December 31, 2022.

4. The convertible bonds were sold at par.

5. The income tax rate for 2022 is 30%.

Instructions

1. Calculate basic EPS.

2. Calculate diluted EPS. As part of this requirement show the incremental EPS for each item followed by a presentation of most to least dilutive.