Three Financing Alternatives Earnings per Share Computation You are the chief financial officer of a small corporation that is not doing very well net income wise. In fact the last income statement showed $0.00 net income. The board of directors is advising that the company has an opportunity to increase net income before interest and taxes from $0 to $2,000,000 However, to pursue this opportunity the company needs to raise $5,000,000 as the company has little cash. Current info: Current Net Income before Interest and Taxes Common shares currently outstanding Income tax rate $0.00 150,000 25% You are being asked to compute the earnings per share under three possible alternatives to raising the $5,000,000 a. Issue another 150,000 shares of common stock b. Issue $5,000,000 of 8% preferred stock, or C. Issue $5,000,000 of 7% bonds payable Instructions: a. Complete the bottom portion of the income statement appearing on the next sheet for each independent alternative b. After completing the income statements, compute earnings per share under each independent alternative