Answer: $3.00

**Explanation:** The basic EPS is calculated as: \[ \text{Basic EPS} = \frac{\text{Net Income} - \text{Preferred Dividends}}{\text{Weighted Average Number of Shares Outstanding}} \] Given the data: - Net income: $210,000 - Preferred dividends: $0 - Weighted average shares calculation: - From 1 January to 1 April (3 months): 50,000 shares - From 1 April to 1 July (3 months): 30,000 shares (50,000 - 20,000 repurchased) - From 1 July to 31 December (6 months): 60,000 shares (30,000 × 2 due to the stock split) Weighted average shares: \[ \left(50,000 \times \frac{3}{12}\right) + \left(30,000 \times \frac{3}{12}\right) + \left(60,000 \times \frac{6}{12}\right) = 12,500 + 7,500 + 30,000 = 50,000 \] However, the stock split is applied retroactively to the beginning of the period, so the weighted average shares become: \[ \left(50,000 \times 2 \times \frac{3}{12}\right) + \left(30,000 \times 2 \times \frac{9}{12}\right) = 25,000 + 45,000 = 70,000 \] Thus, basic EPS: \[ \frac{210,000}{70,000} = 3.00 \] **Why not B or C?** - **B** incorrectly uses the year-end shares without weighting or retroactive adjustment for the split. - **C** fails to apply the stock split retroactively for the entire period.

Author: LeetQuiz Editorial Team