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Please help with this. Need help figuring this out Three different plans for financing a $5,000,000 corporation are under consideration by its organizers. Under each
Please help with this. Need help figuring this out
Three different plans for financing a $5,000,000 corporation are under consideration by its organizers. Under each of the following plans, the securities will be issued at their par or face amount, and the income tax rate is estimated at 40% of income. Plan 1 Plan 2 Plan 3 10% bonds _ _ $2,500,000 Preferred 10% stock, $40 par _ $2,500,000 1,250,000 Common stock, $5 par $5,000,000 2,500,000 1,250,000 Total $ 5,000,000 $ 5,000,000 $ 5,000,000 Determine for each plan the earnings per share of common stock, assuming that the income before bond interest and income tax is $10,000,000. Enter answers in dollars and cents, rounding to the nearest cent. Earnings Per Shares Common Stock Plan 1 Plan 2 Plan 3 Determine for each plan the earnings per share of common stock, assuming that the income before bond interest and income tax is $4,750,000. Enter answers in dollars and cents, rounding to the nearest cent. Earnings Per Share Common Stock Plan 1 Plan 2 Plan 3Step by Step Solution
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