it says "SB Electronics is considering two plans for raising $4,000,000 to expand operations. plan A is to issue 9% bonds payable, and plan B is to issue $500,000 shares of common stock. before any financing, SB Electronics has net income of $350,000 and 300,000 shares of common stock outstanding. Management belives the company can use the new funds to earn additional income of $700,000 before intrest and taxes. The income tax rate is 21%. Analyze the SB Electronics situation to determine which plan will result in higher earnings per share.

Begin by completing the analysis below for plan A, then plan B. Plan A: Issue $4,000,000 of 9% Bonds Payable Net income before new project Expected income on the new project before interest and income tax expenses Less: Interest expense Project income before income tax Less: Income tax expense Project net income Net income with new project Earnings per share with new project: Plan A Plan B Sectronics is considering two plan for raising 54,000,000 to expand operation Plan A to % bonde payable and plan to issue 600.000 sures of common see my woning. 5 con has recome of $360,000 and 300.000 shares of common stock banding Management believes the company can use the new funds to earn additional income of $700,000 for wrestand. The income tax rates 21. Analyse the Electronic tution to determine which plan wel result inghe sarung perre (Complete an awerboxen Erter for any blooms Roundings per the amounts to the stort