The following information pertains to Beignet Inc.

Net loss $(30,000)

8% Convertible bonds issued at par $225,000

Weighted-average common shares outstanding 200,000

Tax rate, 25%

Each $1,000 bond is convertible into 10 shares of common stock at the option of the bondholder. The bonds were outstanding all year. The company computes diluted EPS using the if-converted method.

Calculate basic and diluted EPS for the year.

Basic EPS Diluted EPS

1. $(0.15) $(0.15)
2. $(0.15) $(0.08)
3. $(0.11) $(0.11)
4. $(0.11) $(0.04)