Question: In its December 31, 2016, balance sheet, Castle, Inc., reported 400,000 issued shares of common stock and 50,000 shares of treasury stock. The 2016 annual

In its December 31, 2016, balance sheet, Castle, Inc., reported 400,000 issued shares of common stock and 50,000 shares of treasury stock. The 2016 annual report also reported 100,000 exercisable incentive stock options. Each option allows the holder to acquire one share of common stock for $18 per share. All of the options were outstanding at the end of 2017. On August 1, 2017, Castle purchased 25,000 shares of treasury stock. The average market price of the common stock during 2018 was $23 per share, and the December 31, 2017, price was $28. Castle's net income for the year ended December 31, 2017, was $1,100,000.
Required:
1. Compute Castle's basic EPS for the year ended December 31, 2017. Round to the nearest cent.
2. Compute Castle's diluted EPS for the year ended December 31, 2017. There are no anti-dilutive securities. Round to the nearest cent.

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