The following information was taken from the books and records of Ludwick, Inc.

1. Net income $ 480,000

2. Capital structure:

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

into 50 shares of common stock at the present date and for the next

10 years. 300,000

b. $10 par common stock, 200,000 shares issued and outstanding

during the entire year. 2,000,000

c. Stock warrants outstanding to buy 16,000 shares of common stock

at $20 per share.

*d. Preferred stock, $10 par, 3%, cumulative, 200,000 shares issued and

outstanding during the year. 2,000,000*

3. Other information:

a. Bonds converted during the year None

b. Income tax rate 30%

c. Convertible debt was outstanding the entire year

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

e. Warrants were outstanding the entire year

f. Warrants exercised during the year None

*g. Dividends in arrears $120,000*

*h. Dividends declared during year. None*

Instructions

*Compute basic and diluted earnings per share.*

* = This exact question is answered on here minus these points, changing the answer