The following information was taken from the books and records of LWAK ltd:

1.Net incomesh.280,000

2.Capital structure:

a.Convertible 6% bonds. Each of the 300, sh.1, 000 bonds is convertible

Into 50 ordinary shares at the present date and for the next

10 years.300,000

b.sh.10 par, 200,000 ordinary shares issued and outstanding

during the entire year.2,000,000

c.Share warrants outstanding to buy 16,000 ordinary shares

at sh.20 per share.

3.Other information:

a.Bonds converted during the yearNone

b.Income tax rate30%

c.Convertible debt was outstanding the entire year

d.Average market price per share of common stock during the yearsh.32

e.Warrants were outstanding the entire year

f.Warrants exercised during the yearNone

Required

Compute basic and diluted earnings per share.

Hint: The following format is recommended for workings/computation

NetAdjust-Adjusted Adjust-AdjustedDiluted

SecurityIncome mentNet IncomeShares ment Shares EPS

Ord. Shares sh.280, 000

Warrants

Conv. Bonds