A Company Wishing to Expand Can Obtain the Necessary Funds

Multiple Choice

A company wishing to expand can obtain the necessary funds by borrowing on a long-term note payable or by issuing 50,000 shares of $10 par value common stock. Net income is estimated at $302,500 if the company borrows the funds, and $330,000 if the company issues stock. The company currently has 250,000 shares of common stock outstanding. If the company issues stock, earnings per share would be:

A) $1.00.
B) $1.10.
C) $1.32.
D) $6.60.