Riggs Corporation (a fictional company) has the following balance sheet information at December 31, 20X2. Current liabilities $ 800,000 Convertible bonds ($1,000 par, 5%) 2,000,000 Common stock ($1 par, 300,000 shares issued 300,000 Additional paid-in capital 2,100,000 Retained earnings 3,230,000 Treasury stock (43,000 shares) (1,161,000 ) Total liabilities and shareholders’ equity $ 7,269,000 The convertible bonds were issued at par in 20X0 and are convertible into Riggs’s common stock at a ratio of 20 shares of stock to 1 bond. In its December 31, 20X2, annual report, Riggs reported 125,000 exercisable qualified stock options. Each option allows the holder to acquire one share of common stock for $19 per share. All of the options were outstanding at the end of 20X3. On October 1, 20X3, Riggs purchased 32,000 shares of treasury stock for $50 per share. The average market price of the common stock during 20X3 was $50 per share, and the December 31, 20X3, price was $56. Riggs’s net income for the year ended December 31, 20X3, was $825,000, and its tax rate was 21%. Required: Compute Riggs’s basic EPS for the year ended December 31, 20X3. Compute Riggs’s diluted EPS for the year ended December 31, 20X3. There are no antidilutive securities. (For all requirements, round your answers to 2 decimal places.)
