On January 2, 2014, Wondrous Co issued at par $50,000 of 4 percent bonds convertible, in total, into 5,000 shares of Wondrous's common stock. No bonds were converted during 2014 . Throughout 2014 Wondrous had 5,000 shares of common stock outstanding. Wondrous' 2014 net income was $5,000 . Wondrous' income tax rate is 40 percent. No potentially dilutive securities other than the convertible bonds
were outstanding during 2014 . Wondrous' diluted earnings per share for 2014 would be
a. $0.58.
b. $0.62.
c. $0.70.
d. $1.16.
B
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