Interest versus dividend expenseMichaels Corporation expects earnings before interest and taxes to be $44,000 for this period. Assuming an ordinary tax rate of 40%, compute the firm's earnings after taxes and earnings available for common stockholders (earnings after taxes and preferred stock dividends, if any) under the following conditions:

a. The firm pays $11,300 in interest.

b. The firm pays $11,300 in preferred stock dividends.

a. Complete the fragment of Michaels Corporation's income statement below to compute the firm's earnings after taxes and earnings available for common stockholders under condition

(a).

(Round to the nearestdollar.)

EBIT	$
Less: Interest expense
Earnings before taxes	$
Less: Taxes (40%)
Earnings after taxes	$
Less: Preferred dividends
Earnings available for common stockholders	$