Question: * Canvas Help Center Question 21 5 pts Classy Office Supplies Inc. is an all equity firm with $2,000,000 in equity. It has been suggested

 * Canvas Help Center Question 21 5 pts Classy Office Supplies

* Canvas Help Center Question 21 5 pts Classy Office Supplies Inc. is an all equity firm with $2,000,000 in equity. It has been suggested that they borrow $800,000 at 6% and use it to buy back shares of their own stock, thereby changing their capital structure. There are 100,000 shares outstanding and they currently sell for $20/share. EBIT is expected to be $1,000,000 next year. Classy is in the 21% tax bracket What is the EPS under the current structure? What will EPS be under the proposed structure? Should Classy do the restructuring? Yes or No BIYA-A- IEE 3.0 X X - A V O 112pt HTML Editor - Paragraph - Question 22 Sots

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