Plan 1 Plan 2 Plan 3 10% Bonds $2,000,000 Preferred 10% stock, $40 par $2,000,000 1,000,000 Common stock, 54 par $4,000,000 2,000,000 1,000,000 Total $ 4,000,000 $ 4,000,000 $ 4,000,000 Required: 1. Determine the earings per share of common stock for each plan, assuming that the income before bond interest and income tax is $8,000,000. Enter answers in dollars and cents, rounding to two decimal places. Earnings Per Share on Common Stock Plan! Plan 2 Plan 3 2. Determine the earnings per share of common stock for each plan, assuming that the income before bond interest and income tax is $3,000,000. Enter answers in dollars and cents, rounding to two decimal places. Earnings Per Share on Common Stock Plan 1 DAR eBook Share on Common Stock Plan 1 Plan 2 Plan 3 2. Determine the eamings per share of common stock for each plan, assuming that the Income before bond interest and income tax 15 $3,800,000. Enter answers in dollars and cents, rounding to two decimal places. Earnings Per Share on Common Stock Plan 1 Plan 2 Plan 3 3. The principal advantage of Plant is that it involves only the essence of common stock, which does not require a perlodie interest payment or return of principal, and a payment of preferred dividends is not required Why W Set up a column for each plan. Remember to take interest income tax and dividends into consideration Consider the impact on shareholders with each plan. In deciding among financing plans, the effect on earnings per share is often considered. Keep in mind issues of what obligations the firm must pay even during periods of earnings declines