Reference no: EM131596470

Question - On December 31, 2012, Berclair Inc. had 200 million shares of common stock and 5 million shares of 9%, $100 par value cumulative but nonconvertible preferred stock issued and outstanding. On March 1, 2013, Berclair purchased 24 million shares of its common stock as treasury stock. Berclair declared a 2 for-1 stock split on July 1, 2013. Four million new shares were sold on October 1. Net income for the year ended December 31, 2013, was $150 million. The income tax rate is 40%

Also outstanding at December 31 were stock options granted to key executives on September 13, 2012. The options are exercisable for 40 million common shares at an exercise price of $56 per share. During 2013, the market price of the common shares averaged $70 per share, peaking at $80 on December 31.

$62.5 million of 8% bonds, convertible into 6 million common shares, were issued at face value in 2009.

Required: Compute Berclair's basic and diluted earnings per share for the year ended December 31, 2013. Round the amount to the nearest penny; must show all necessary calculations.