Gilliland Airlines is considering two alternatives for the financing of a purchase of a fleet of airplanes. These two alternatives are: 1. Issue 95,100 shares of common stock at $30 per share. (Cash dividends have not been paid nor is the payment of any contemplated.) 2. Issue 9%, 10-year bonds at face value for $2,853,000. It is estimated that the company will earn $851,500 before interest and taxes as a result of this purchase. The company has an estimated tax rate of 40% and has 114,000 shares of common stock outstanding prior to the new financing. Determine the effect on net income and earnings per share for these two methods of financing.