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Speegleville Marina needs to raise $0.9 million to expand the company. Speegleville Marina is considering the issuance of either . $900,000 of 6% bonds payable,
Speegleville Marina needs to raise $0.9 million to expand the company. Speegleville Marina is considering the issuance of either . $900,000 of 6% bonds payable, or 100,000 common shares at $9 per share. (Click the icon to view additional information.) Prepare an analysis to determine which plan is likely to result in higher earnings per share. Based solely on the earnings-per-share comparison, which financing plan would you recommend for Speegleville Marina? C. Start by preparing the analysis to determine which plan is likely to result in higher earnings per share (EPS). (For amounts with a $0 balance, make sure to enter "0" in the appropriate column.) Plan 1 Plan 2 Issue $900,000 Issue $900,000 of 6% Bonds Payable - X of Common Shares Additional info Less: Before any new financing, Speegleville Marina expects to earn net income of $450,000, and the company already has 100,000 shares of common shares outstanding. Speegleville Marina believes the expansion will increase income before interest and income tax by $120,000. The income tax rate is 40%. Less: Print Done Which financing plan would you recommend based solely on EPS
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