Poppy Corporation owns 60 percent of Seed Company’s common shares. Balance sheet data for the companies on December 31, 20X2, are as follows:

The bonds of Poppy Corporation and Seed Company pay annual interest of 8 percent and 10 percent, respectively. Poppy’s bonds are not convertible. Seed’s bonds can be converted into 10,000 shares of its company stock any time after January 1, 20X1. An income tax rate of 40 percent is applicable to both companies. Seed reports net income of $30,000 for 20X2 and pays dividends of $15,000. Poppy reports income from its separate operations of $45,000 and pays dividends of $25,000.

Required

Compute basic and diluted EPS for the consolidated entity for 20X2.

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Cash Accounts Receivable Inventory Buildings & Equipment Less: Accumulated Depreciation Investment in Seed Company Stock Total Assets Accounts Payable Bonds Payable Common Stock ($10 par value) Retained Earnings Total Liabilities & Owners' Equity Poppy Corporation Seed Company $ 85,000 80,000 120,000 700,000 (240,000) 150,000 $895,000 $500,000 $145,000 $ 50,000 250,000 200,000 300,000 100,000 200,000 150,000 $895,000 $500,000 $ 30,000 50,000 100,000 400,000 (80,000)