Transcribed Image Text: Frey Co. is considering the following alternative financing plans: Plan 1 Plan 2 Issue 5% bonds (at face value) $6,000,000 $2,000,000 Issue preferred $1 stock, $20 par

Transcribed Image Text: Frey Co. is considering the following alternative financing plans:
Plan 1
Plan 2
Issue 5% bonds (at face value)
$6,000,000
$2,000,000
Issue preferred $1 stock, $20 par
6,000,000
Issue common stock, $25 par
6,000,000
4,000,000
Income tax is estimated at 40% of income.
Determine the earnings per share of common stock, assuming income before bond interest and income tax is $800,000.
Enter answers in dollars and cents, rounding to the nearest whole cent.
Plan 1
Earnings per share on common stock
Plan 2
Earnings per share on common stock

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