cant seem to figure out how to determine the earnings per share on common stock?? Help please!! Alternative Financing Plans Frey Co. is considering the following alternative financing plans: Plan 1 Plan 2 Issue 10% bonds (at face value) $1,120,000 $560,000 Issue preferred $1 stock, $10 par — 930,000 Issue common stock, $5 par 1,120,000 750,000 Income tax is estimated at 40% of income. Determine the earnings per share on common stock, assuming that income before bond interest and income tax is $896,000. Enter answers in dollars and cents, rounding to the nearest cent.
cant seem to figure out how to determine the earnings per share on common stock?? Help please!! Alternative Financing Plans Frey Co. is considering the following alternative financing plans: Plan 1 Plan 2 Issue 10% bonds (at face value) $1,120,000 $560,000 Issue preferred $1 stock, $10 par — 930,000 Issue common stock, $5 par 1,120,000 750,000 Income tax is estimated at 40% of income. Determine the earnings per share on common stock, assuming that income before bond interest and income tax is $896,000. Enter answers in dollars and cents, rounding to the nearest cent.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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I cant seem to figure out how to determine the earnings per share on common stock?? Help please!!
Alternative Financing Plans
Frey Co. is considering the following alternative financing plans:
| Plan 1 | Plan 2 | |||
| Issue 10% bonds (at face value) | $1,120,000 | $560,000 | ||
| Issue |
— | 930,000 | ||
| Issue common stock, $5 par | 1,120,000 | 750,000 |
Income tax is estimated at 40% of income.
Determine the earnings per share on common stock, assuming that income before bond interest and income tax is $896,000.
Enter answers in dollars and cents, rounding to the nearest cent.
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