Step 1: Step up the information supplied in the problem:

Common Stock                                  Debt

Earnings * .7%                    (Earnings -9,000) *.7%                   

1,500 Shares                                         1,000 Shares      

Step 2: Balance the fractions so the EPS are the same

1. The common stock denominator is 67% (1,000/1,500) larger than debt (500 more shares)

2.  Therefore the 9,000 deduction in the numerator is divided by the inverse to balance the fractions.

      Inverse = 33% (9,000/.3333) = 27,000

3. If one denominator is 67% percent larger, then the numerator has to be 67% larger as well.

If no additional information were supplied, just take the denominator in the common stock and divide it by the % difference and the denominator in the debt divided by the % difference and it will balance.