Problem
XYZ, INC had net income of $10 million for the year. It had outstanding 1 million common stock shares until September 30th when us issued another 500,000 shares (1,500,000 at year-end). XYZ also had 50,000 preferred shares that paid a $4 annual dividend. The preferred stock was convertible into common stock at the rate of 2 common shares for each preferred share.
Calculate the company's basic and fully diluted earnings per share.