A company earns perpetual annual cash flows, and uses no debt. The company's weighted average cost of capital is $10\mathrm{.}0$ percent. If the current market value of the equity is $$12$ million and there are no taxes, what is EBIT? $[$Express your answer rounded to the closest dollar with NO COMMAS $($e$.$g$.650000)]$

EBIT $=$$

Answer Key:$1200000$

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V $=$ EBIT$/$WACC

$12$M $=$ EBIT$/0\mathrm{.}1$

So EBIT$=12$M X $0\mathrm{.}1=1\mathrm{.}2$ Million

Can you explain where they got the v $=$ EBIT$/$WACC equation from? I don't understand it$.$