Question: 2. XYZ is comparing two different capital structures NEW PLAN 10,150,000 EQUITY SHARES OUTSTANDING PRICE PER SHARE DEBT COST OF DEBT CURRENT PLAN 3,150,000 21

2. XYZ is comparing two different capital structures NEW PLAN 10,150,000

2. XYZ is comparing two different capital structures NEW PLAN 10,150,000 EQUITY SHARES OUTSTANDING PRICE PER SHARE DEBT COST OF DEBT CURRENT PLAN 3,150,000 21 34,000,000 12% 0% Assuming no tax a. If EBIT is $5,000,000, which plan will result in the higher EPS? b. What is the break-even EBIT at which both the Plans would give the same EPS

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