Current	Proposed				Current Capital Structure: No Debt					Proposed Capital Structure: Debt = $4 million
Assets	$8,000,000	$8,000,000					Recession	Expected	Expansion			Recession	Expected	Expansion
Debt	$0	$4,000,000				EBIT	$500,000	$900,000	$1,300,000		EBIT	$500,000	$900,000	$1,300,000
Equity	$8,000,000	$4,000,000
Debt/Equity Ratio	0	1
Share Price	$20	$20
Shares Outstanding	400,000	200,000
Interest rate	N/A	10%
a) Calculate the Interest, Net income, ROE, and EPS for the current and proposed capital structure.
b) Calculate the Breakeven EBIT.