Preferred 10% stock, $40 par: Plan 2: $5,000,000 and Plan 3: 2,500,000 Common stock, 10 par: Plan 1: $10,000,000 Plan 2: 5,000,000 Plan 3: 2,500,000 Total: Plan 1: 10,000,000 Plan 2: 10,000,000 Plan 3: 10,000,000
1. Detemine for each plan the earnings per share of common stock, assuming that the income before the bond interest and income tax is $2,000,000.
2. Detemine for each plan the earnings per share of common stock, assuming that the income before the bond interest and income tax is $950,000.