Alternative Financing Plans

Folmar Co. is considering the following alternative financing plans:

	Plan 1	Plan 2
Issue 10% bonds (at face value)	$880,000		$440,000
Issue preferred $1 stock, $10 par			730,000
Issue common stock, $5 par	880,000		590,000

Income tax is estimated at 40% of income.

Determine theearnings per share on common stock, assuming income beforebondinterest and income tax is $616,000.

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

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