CALCULLE PRINTER VERSION BACK Brief Exercise 10-16 Kingbird, Inc. is considering two alternatives to finance its construction of a new $1 million plant. (a) Issuance of 100,000 shares of common stock at the market price of $10 per share. (b) Issuance of $1 million, 6% bonds at face value. Complete the following table. (Round earnings per share to 2 decimal places, e.g. 0.25.) Issue Stock Issue Bond Income before interest and taxes $670,000 $670,000 Interest expense from bonds 0 60,000 Income before income taxes 670,000 610000 Income tax expense (30%) 201000 183000 Net income $ 469000 427000 Outstanding shares 670,000 570,000 Earnings per share Indicate which alternative is preferable. Net income if stock is used. However, earnings per share is than earnings per share if bonds are used because of the additional shares of stock that are outstanding