Question: A firm is analyzing two possible capital structures and 50 percent debt ratios. The firm has total assets of $5,000,000 and common stock valued at
A firm is analyzing two possible capital structures and 50 percent debt ratios. The firm has total assets of $5,000,000 and common stock valued at $50 per share. The firm has a marginal tax rate of 40 percent on ordinary income The number of common shares outstanding for each of the capital structures would be O A. 30 percent debt ratio: 70,000 shares and 50 percent debt ratio: 100,000 shares OB. 30 percent debt ratio: 30,000 shares and 50 percent debt ratio: 50,000 shares O C. 30 percent debt ratio: 70,000 shares and 50 percent debt ratio 50.000 shares OD. 30 percent debt ratio 50.000 shares and 50 percent debt ratio: 70,000 shares Click to select your answer AM 4/30/2020
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