Alternative Financing Plans

Brower Co. is considering the following alternative financing plans:

	Plan 1		Plan 2
Issue 10% bonds (at face value)	$4,000,000		$2,500,000
Issue preferred $2.50 stock, $25 par			3,000,000
Issue common stock, $10 par	4,000,000		2,500,000

Income tax is estimated at 40% of income.

Determine the earnings per share of common stock, assuming income before bond interest and income tax is $2,000,000.

Enter answers in dollars and cents, rounding to the nearest whole cent.

Plan 1	$ Earnings per share on common stock
Plan 2	$ Earnings per share on common stock