The following financial information is available at the end of the year. Share Information:

Security	Authorized	Issued & outstanding	Other features
Common stock	500,000	250,000	Currently pays a dividend of $1 per share.
Preferred stock, series A	50,000	15,000	Nonconvertible, cumulative; pays a dividend of $5 per share.
Preferred stock, series B	50,000	40,000	Convertible; pays a dividend of $8.50 per share. Each share is convertible into 2.5 common shares.

Additional Information:

Retained earnings at start of year = $6,000,000 and Reported income for the year = $1,250,000.

The diluted EPS is closest to:

A.

$2.91.

B.

$2.39.

C.

$2.61

D.

2.19