Witter House is a calendar-year firm with 480 million common shares outstanding throughout 2021 and 2022. As part of its executive compensation plan, at January 1, 2020, the company had issued 50 million executive stock options permitting executives to buy 50 million shares of stock for $14 within the next eight years, but not prior to January 1, 2023. The fair value of the options was estimated on the grant date to be $3 per option. In 2021, Witter House began granting employees stock awards rather than stock options as part of its equity compensation plans and granted 25 million restricted common shares to senior executives at January 1, 2021. The shares vest four years later. The fair value of the stock was $20 per share on the grant date. The average price of the common shares was $20 and $25 during 2021 and 2022, respectively. The stock options qualify as an incentive plan. The restricted stock does not. The company's net income was $330 million and $340 million in 2021 and 2022, respectively. Required: 1. Compute basic and diluted earnings per share for Witter House in 2021. 2. Compute basic and diluted earnings per share for Witter House in 2022.

Numerator Denominator Earnings per share 1. Basic / II Diluted 2. Basic / Diluted