Reference no: EM132654433

Question - Throughout 2019, H had 10,000,000 shares of common stock issued and outstanding and 400,000 shares of 7%, $10 par value convertible preferred stock issued outstanding. Each share of preferred stock can be converted into 4 shares of B's common stock. H's net income for 2019 was $8,600,000. During 2019 H paid $280,000 of dividends on its preferred stock and $2,000,000 of dividends on its common stock. H's income tax rate is 20%.

As of 12-31-19, H had $25,000,000 of 5%, 10-year convertible bonds outstanding. H issued the bonds at par during 2015. The bonds can be converted into 1,000,000 shares of H's common stock.

As of 12-31-19, H had $75,000,000 of 8%, 15-year convertible bonds. H issued the bonds at par during 2010. The bonds can be converted into 8,000,000 shares of H's common stock.

During the entire year ending 12-31-19, H had 1,500,000 outstanding and exercisable employee stock options that were granted to employees during 2015. Each option has an exercise price of $30 per share of H common stock. During 2019, the average market price of H's common stock was $45 per share.

During the entire year ending 12-31-19, H had 900,000 outstanding and exercisable employee stock options that were granted to employees during 2017. Each option has an exercise price of $50 per share of H common stock.

Required -

What will H report as basic EPS for the year ended 12-31-19? ROUND TO NEAREST PENNY.

What will H report as diluted EPS for the year ended 12-31-19? ROUND TO NEAREST PENNY.