Crane Company reports the following operating results for the month of August: sales $420,000 (units 5,600), variable costs $254,000, and fixed costs $94,000. Management is considering the following independent courses of action to increase net income. 1. Increase selling price by 12% with no change in total variable costs or units sold. 2. Reduce variable costs to 58% of sales.

On january 1, 2017, pharoah company issued 10-year, $2,020,000 face value, 6% bonds, at par. each $1,000 bond is convertible into 16 shares of pharoah common stock. pharoah’s net income in 2017 was $317,000, and its tax rate was 40%. the company had 97,000 shares of common stock outstanding throughout 2017. none of the bonds were converted in 2017. (a) compute diluted earnings per share for 2017. (round answer to 2 decimal places, e.g. $2.55.) diluted earnings per share