The information below pertains to Blue Company for 2018. $1,140,000 1,900,000 Net income for the year 6% convertible bonds issued at par ($1,000 per bond); each bond is convertible into 20 shares of common stock 6% convertible, cumulative preferred stock, $100 par value; each share is convertible into 5 shares of common stock Tax rate for 2018 Average market price of common stock 3,870,000 40% $25 per share There were 570,000 shares of shares of common stock outstanding on 1/1/2018. On April 1, 2018, the company issued 40,000 common shares. There were no changes in the number of preferred shares, or convertible bonds outstanding. There was no treasury stock. The company also has common stock options (granted in a prior year) to purchase 70,500 shares of common stock at $20 per share. Required: 1. Compute basic earings per share for 2018. 2. Compute diluted earnings per share for 2018