Problem
Computing Basic and Diluted Earnings per Share Nichols Corporation began the year 2015 with 50,000 shares of common stock and 10,000 shares of convertible preferred stock outstanding. On May 1, an additional 18,000 shares of common stock were issued. On July 'I, the 12,000 shares ofcommon stock were acquired for the treasury. On September 1, the 12,000 treasury shares of common stock were reissued. The preferred stock has a $4 per share divlclend rate, and each share may be converted into 2 shares of common stock. Nichols Corporation's 2015 net income is $460,000. Required
i. Compute earnings per share for 2015.
ii. Compute diluted earnings per share for 2015.