Question: Home Depot Inc HD had 1 7 billion shares of common
Home Depot, Inc. (HD) had 1.7 billion shares of common stock outstanding in 2008, whereas Lowe’s Companies, Inc. (LOW) had 1.46 billion shares outstanding. Given both firms’ 2008 earnings levels found in Study Problems and assuming a 35 percent tax rate for both firms, what is their break-even level of operating income (i.e., the level of EBIT where EPS is the same for both firms)?
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