The following information was taken from the books and records of Simonic, Inc.:

1. Net income $ 280,000

2. Capital structure:

a. Convertible 6% bonds. Each of the 300, $1,000 bonds is convertible

into 50 shares of common stock . 300,000

b. $10 par common stock, 200,000 shares issued and outstanding

during the entire year. 2,000,000

c. Stock options outstanding to buy 16,000 shares of common stock

at $20 per share.

3. Other information:

a. Bonds converted during the year None

b. Income tax rate 30%

c. Convertible debt was outstanding the entire year

d. Average market price per share of common stock during the year $32

e. Options were outstanding the entire year

f. Options exercised during the year None

Instructions

Compute basic and diluted earnings per share.