2 Required information The following information applies to the questions displayed below) Penny Arcades, Inc., is trying to decide between the following two alternatives to finance its new $35 million gaming center: a. Issue $35 million, 7% note. b. Issue 1 million shares of common stock for $35 per share. Required: 1. Assuming the note or shares of stock are issued at the beginning of the year, complete the income statement for each alternative. (Enter your answers in dollars, not millions. (.e., $5.5 million should be entered as 5,500,000). Round your "Earnings per Share" to 2 decimal places.) Issue Note Issue Stock $ 11,000,000 $ 11,000,000 2,450,000 0 $ 8,550,000 $ 11,000,000 Operating income Interest expense (note only) Income before tax Income tax expense (35%) Net Income Number of shares Earnings per share (Net income /# of shares) $ 8,550,000 $ 4,000,000 11,000,000 5,000,000