1. Fleming Corporation has plans to raise K 2 million in capital by issuing 50,000 shares of K 20.00 common stock and by issuing K 1 million in bonds @ 12% interest. Fleming's tax rate is 40%. Fleming expects EBIT (Earnings Before Interest Taxes) of K 4.5 million and its current capital structure consists only of common stock - 250,000 shares outstanding.

What are the EPS (Earnings per Share) before and after the financing