Question
Alternative Financing Plans Frey Co. is considering the following alternative financing plans: Plan 1 Plan 2 Issue 10% bonds (at face value) $880,000 $440,000 Issue
Alternative Financing Plans Frey 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 the earnings per share on common stock, assuming that income before bond interest and income tax is $264,000. 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
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