Windsor, Inc. is considering these two alternatives to finance its construction of a new $1.76 million plant: Issuance of 176,000 shares of common stock at the market price of $10 per share. Issuance of $1.76 million, 7% bonds at face value. 1. 2. (a) Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock Issue Bonds Income before interest and taxes $1,584,000 $1,584,000 Interest expense from bonds Income before income taxes Income tax expense (40%) Net income
Windsor, Inc. is considering these two alternatives to finance its construction of a new $1.76 million plant: Issuance of 176,000 shares of common stock at the market price of $10 per share. Issuance of $1.76 million, 7% bonds at face value. 1. 2. (a) Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock Issue Bonds Income before interest and taxes $1,584,000 $1,584,000 Interest expense from bonds Income before income taxes Income tax expense (40%) Net income
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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