Please explain step by step how to solve this and show the formula used:

Pulp Paper Company and Holt Paper Company are each able to generate earnings before interest and taxes of $150,000. The separate capital structures for Pulp and Holt are shown below:

Pulp		Holt
Debt @ 10%	$ 800,000	Debt @ 10%	$ 400,000
Common stock, $5 par	700,000	Common stock, $5 par	1,100,000
Total	$1,500,000	Total	$1,500,000
Common shares	140,000	Common shares	220,000

Compute earnings per share for both firms. Assume a 40 percent tax rate.

In part 1, you should have the same answer for both companies earnings per share. Assuming a P/E ratio of 20 for each company, what would each companys stock price be?