i need the answer quickly Crane Company is considering these two alternatives for financing the purchase of a fleet of airplanes:1.Issue 62,500 shares of common stock at $45 per share. (Cash dividends have not been paid nor is the payment of anycontemplated.)2.Issue 10%, 10-year bonds at face value for $2,812,500.It is estimated that the company will earn $825,100 before interest and taxes as a result of this purchase. The company has anestimated tax rate of 30% and has 93,600 shares of common stock outstanding prior to the new financing.Determine the effect on net income and earnings per share for (a) issuing stock and (b) issuing bonds. Assume the new shares or newbonds will be outstanding for the entire year. (Round earnings per share to 2 decimal places, e.g. 2.66.)(a) Plan OneIssue StockA14(b) Plan TwoIssue BondsA

The earnings per share is the net income available on each common stock of the company. It is a very…

Answered: Crane Company is considering these two…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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