Question: Break-even EBIT (EBIT -Int)(1-t) - Div pref = (EBIT -Int) (1-t) - Div pref No. of shares, A No. of shares, B Break-even EBIT
Break-even EBIT (EBIT -Int)(1-t) - Div pref = (EBIT -Int) (1-t) - Div pref No. of shares, A No. of shares, B Break-even EBIT Calculate Break-even EBIT and EPS in our example where EBIT=P4.2mn and: a) Option A: P15mn all-equity, 150,000 shares, t=32% b) Option B: P9mn equity, P6mn debt, P1.02mn interest expense, 90,000 shares, t=32%
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