Peyton Approved Earnings per Share For Year Ended 12/31/20XX Net Income 12,481,107.51 Less: Preferred Dividends (50,000.00) Earnings Available to Common Shareholders 12,531,107.51 Common Shares Outstanding 1,750,000 Basic EPS 7.16 If all preferred shares are converted: Net Income 12,481,107.51 Additional Common Shares 100,000 Common Shares Outstanding after conversion 1,850,000 EPS if preferred shares converted 6.75 Preferred shares are antidilutive If all bonds are converted: Net Income 12,481,107.51 Less: Preferred Dividends (50,000.00) Add back interest on bonds, net of income tax 56,000.00 Earnings Available to Common Shareholders 12,487,107.51 Additional Common Shares Common Shares Outstanding after conversion Fully diluted EPS Peyton plans to raise $1,000,000 million of additional capital for the coming year. They anticipate that it will enable them to earn an additional $600,000 after tax. What would be the impact on earnings per share if the raise the $1,000,000 by: a) issuing 10,000 share of 10% $100 par value convertible preferred stock, where share can be coverted into 10 shares of Peyton common stock? b) issuing $1,000,000 of 8% convertible bond, each $1,000 bond can be converted into? 5 shares of Peyton common stock? c) $500,000 of each of the above? Net Income Less: Preferred Dividends Earnings Available to Common Shareholders Common Shares Outstanding Basic EPS a If all preferred shares are converted: Net Income Additional Common Shares Common Shares Outstanding after conversion EPS if preferred shares converted Preferred shares are antidilutive b If all bonds are converted: Net Income Less: Preferred Dividends Add back interest on bonds, net of income tax Earnings Available to Common Shareholders Additional Common Shares Common Shares Outstanding after conversion