Question: 15. Gil Inc. is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, Gil would

15. Gil Inc. is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, Gil would have 178,500 shares of stock outstanding. Under Plan II, there would be 71,400 shares of stock outstanding and $1.79 million in debt outstanding. The interest rate on the debt is 10 percent and there are no taxes. What is the breakeven EBIT?

A. $287,878.78 B. $298,333.33 C. $351,111.11 D. $333,333.33 E. $341,414.14

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