Question: Plan 1 Plan 2 Issue 10% Bonds (at face) $400,000 Issue $10 par Common Stock $600,000 $200,000 Income tax is estimated at 40% of income.

Plan 1 Plan 2 Issue 10% Bonds (at face) $400,000 Issue

Plan 1 Plan 2 Issue 10% Bonds (at face) $400,000 Issue $10 par Common Stock $600,000 $200,000 Income tax is estimated at 40% of income. Determine the earnings per share of common stock under the two alternative financing plans, assuming income before bond interest and income tax is $150,000. Round your answers to two decimal places. Plan 1 Plan 2

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