Amy Dyken, controller at Fitzgerald Pharmaceutical Industries, a public company, is currently preparing the calculation for basic

Question:

Amy Dyken, controller at Fitzgerald Pharmaceutical Industries, a public company, is currently preparing the calculation for basic and diluted earnings per share and the related disclosure for Fitzgerald's financial statements. Below is selected financial information for the fiscal year ended June 30, 2014.
FITZGERALD PHARMACEUTICAL INDUSTRIES
SELECTED JUNE 30, 2014
Long-term debt
Notes payable, 9% .............................................................. $1,093,000
7% convertible bonds payable .................................................. 5,150,000
9% bonds payable ................................................................ 6,142,000
Total long-term debt ........................................................... $12,385,000
Shareholders' equity
Preferred stock, 5% cumulative, $58 par value, 107,100 shares
authorized, 26,775 shares issued and outstanding ......................... $1,552,950
Common stock, $1 par, 10,129,000 shares authorized,
1,012,900 shares issued and outstanding ....................................... 1,012,900
Additional paid-in capital ......................................................... 4,001,500
Retained earnings .................................................................. 6,012,400
Total shareholders' equity ...................................................... $12,579,750
The following transactions have also occurred at Fitzgerald.
1. Options were granted on July 1, 2013, to purchase 206,100 shares at $15 per share. Although no options were exercised during fiscal year 2014, the average price per common share during fiscal year 2014 was $30 per share.
2. Each bond was issued at face value. The 7% convertible bonds will convert into at 58 shares per $1,000 bond. The bonds are exercisable after 5 years and were issued in fiscal year 2013.
3. The preferred stock was issued in 2013.
4. There are no preferred dividends in arrears; however, preferred dividends were not declared in fiscal year 2014.
5. The 1,012,900 shares of were outstanding for the entire 2014 fiscal year.
6. Net income for fiscal year 2014 was $1,519,000, and the average income tax rate is 40%.
Instructions
For the fiscal year ended June 30, 2014, calculate the following for Fitzgerald Pharmaceutical Industries.
(a) Basic earnings per share.
(b) Diluted earnings per share.
Common Stock
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