Information concerning the capital structure of Catan Corporation follows
Dec. 31, 2020 Dec. 31, 2019
Common shares outstanding 100,000 shares 100,000 shares
Convertible preferred shares outstanding 10,000 shares 10,000 shares
9% convertible bonds $ 2,000,000 $ 2,000,000
During 2020, Catan paid dividends of $ 1.00 per common share and $ 2.50 per preferred share. The preferred shares are non-cumulative, and convertible into 20,000 common shares. The 9% convertible bonds are convertible into 50,000 common shares. Net income for calendar 2020 was $500,000. Assume the income tax rate is 30%. Basic earnings per share for 2020 is
Select one:
a. $ 3.65
b. $ 4.75
c. $ 3.33
d. $ 5.00