Complete this table given the information from a case study.

Currently the company has value of S5 million with outstanding shares of 100,000. The company generates $1,538,461.5 in earnings before interest and taxes (EBIT) in perpetuity. The corporate tax rate is 35 percent and all earnings are paid as dividends. The company is considering the effect of $2 million and $2.5 million debt -equity swap on its cost of capital and its value. The cost of debt is 10 percent and the cost of capital is currently 20 percent. Any investment in net working capital and capital expenditure is equal to its depreciation allowances. The corporate tax rate is 35 percent. Table 1 Current Debt Debt Book Value of Debt Book Value of E $2,000,000 $3,000,000 $2,500,000 $2,500,000 5,000.000 Market Value of Debt Market Value of Equity V-D+E Pretax Cost of Debt $2,000,000 $2,500,000 10.00% 10.00% 10.00% 6.50% 6 50% 650% After-Tax Cost of Debt (t Market Value Weights of rate 35% Debt Equity Cost of Equity 20.00% EBIT $ 1,538,461.501,538,461.50 S1,538,461.50 Taxes (@ 35 Net Income change in NWC -C Free Cash Flow Value of Firm (FCF Table 2 Current Capital Debt Debt 2,000,000 $2,500,000 Pure Business Cash Flows EBIT Taxes 5% Net Income -Capital Exp. in net Free Cash Flow red W Value of Pure Business Flows: (FCF/Unlevered WACC) Financing Cash Flows Interest at 10% Pretax Cost of Debt Value of Financing Effect Tax Reduction/Pretax Cost of Debt Total Value (Sum of Values of Pure Business Flows and Table 3 Debt Current Capital Structure Debt Cash Flow to Debtholders (interest) Pretax Cost of Debt Value of Debt:(Interest/Rd Cash Flow to Shareholders EBIT Interest Pretax Profit Taxes@ 5% Net Income +Depreciation change in NWC Capital ex Cash Flow to Shareholders Cost of E Currently the company has value of S5 million with outstanding shares of 100,000. The company generates $1,538,461.5 in earnings before interest and taxes (EBIT) in perpetuity. The corporate tax rate is 35 percent and all earnings are paid as dividends. The company is considering the effect of $2 million and $2.5 million debt -equity swap on its cost of capital and its value. The cost of debt is 10 percent and the cost of capital is currently 20 percent. Any investment in net working capital and capital expenditure is equal to its depreciation allowances. The corporate tax rate is 35 percent. Table 1 Current Debt Debt Book Value of Debt Book Value of E $2,000,000 $3,000,000 $2,500,000 $2,500,000 5,000.000 Market Value of Debt Market Value of Equity V-D+E Pretax Cost of Debt $2,000,000 $2,500,000 10.00% 10.00% 10.00% 6.50% 6 50% 650% After-Tax Cost of Debt (t Market Value Weights of rate 35% Debt Equity Cost of Equity 20.00% EBIT $ 1,538,461.501,538,461.50 S1,538,461.50 Taxes (@ 35 Net Income change in NWC -C Free Cash Flow Value of Firm (FCF Table 2 Current Capital Debt Debt 2,000,000 $2,500,000 Pure Business Cash Flows EBIT Taxes 5% Net Income -Capital Exp. in net Free Cash Flow red W Value of Pure Business Flows: (FCF/Unlevered WACC) Financing Cash Flows Interest at 10% Pretax Cost of Debt Value of Financing Effect Tax Reduction/Pretax Cost of Debt Total Value (Sum of Values of Pure Business Flows and Table 3 Debt Current Capital Structure Debt Cash Flow to Debtholders (interest) Pretax Cost of Debt Value of Debt:(Interest/Rd Cash Flow to Shareholders EBIT Interest Pretax Profit Taxes@ 5% Net Income +Depreciation change in NWC Capital ex Cash Flow to Shareholders Cost of E