Rise Against Corporation is comparing two different capital structures: an all-equity plan (Plan I) and a levered plan (

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Rise Against Corporation Is Comparing Two Different Capital Structures An All Equity Plan Plan I And A Levered Plan 1 (91.69 KiB) Viewed 39 times

Rise Against Corporation is comparing two different capital structures: an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 160,000 shares of stock outstanding. Under Plan II, there would be 110,000 shares of stock outstanding and $1.40 million in debt outstanding. The interest rate on the debt is 7 percent, and there are no taxes. a. If EBIT is $400,000, what is the EPS for each plan? (Round your answers to 2 decimal places.(e.g., 32.16)) Plan I Plan II EPS Plan I Plan II $ b. If EBIT is $650,000, what is the EPS for each plan? (Round your answers to 2 decimal places.(e.g., 32.16)) EPS $ c. What is the break-even EBIT? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollars, i.e. 1,234,567.) Break-even EBIT