V-Earnings Per Share with Convertible Preferred Stock. Net Income is $400,000. Preferred Stock Dividends are $1,500. Weighted Average number of common shares outstanding is 50,000. The preferred stock can be converted into 15,000 shares of common stock. Facts: EPS with Convertible Preferred Stock Net income 400,000 Pref Stock Dividends = 1,500; Shares Outstanding 50,000 a) Basic EPS Basic EPS Net Income Pref Stock Div #s Basic EPS NI - PS Div # Shares b) Diluted EPS Facts: EPS with Convertible Preferred Stock .Net income = 400,000 Pref Stock Dividends = 1,500; Shares Outstanding-50,000 New shares after conversion = 15,000 Diluted EPS Net Pref Stock Pref Stock Div Numbers Diluted EPS Income Div NI - PS Div +PSDiv OsShares+ new Shares New