CALCULATOR FULL Brief Exercise 15-10 Sunland Inc. Iis considering two alternatives to finanoe its construction...
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CALCULATOR FULL Brief Exercise 15-10 Sunland Inc. Iis considering two alternatives to finanoe its construction of a new $2.20 million plant (a) Issuance of 220,000 shares of common stock at the market price of $10 per share (b) issuance of S2200,000, 7% bonds at face value. Complete the folowing table. (Round earnings per share to 2 decimal places, e.g. 0.2s.) Issue Stock Issue Bond Income before interest and taxes Interest expense Income before income taxes Income tax expense (30%, Net income $650,000$650,000 Outstanding shares Earnings per share Indicate which alternative is preferable. Net income is 430,000 9 if stock is used. However, earnings per share is than earnings per share if bonds are used because of the additional shares of stock that are outstanding
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