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  3. on january 1, shannon star inc. had 610,000 common

On January 1, Shannon Star Inc. had 610,000 common shares outstanding. The company issued an...

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Accounting

On January 1, Shannon Star Inc. had 610,000 common shares outstanding. The company issued an
additional 132,000 shares on March 1. Shannon Star also issued $1,900,000 par value, 2%
nonconvertible, noncumulative preferred stock on October 1 and declared dividends for the current
quarter. On April 30, the firm issued $5,190,000,3% convertible bonds outstanding (i.e., $155,700
coupon interest per year) that are convertible into 105,000 shares of common stock. The firm issued all
bonds at par and did not convert any during the current year. The company is subject to a 40% tax rate
and net income is $6,600,000.
Requirement
Based on this information, compute basic and diluted earnings per share for the current year.
Calculate the basic earnings per share (EPS) for the current year. (Rounds the EPS to the nearest cent, X.XX)
Calculate the diluted EPS for the current year. (Rounds the EPS to the nearest cent, X.XX)
Please answer the two questions above.
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