Question: Dar corporation is comparing two different capital structures; an all equity plan and levered plan. under plan 1 the cmpany would have 155,000 shares of

Dar corporation is comparing two different capital structures; an all equity plan and levered plan. under plan 1 the cmpany would have 155,000 shares of stock outstanding. under plan II there would be 105,000 shares of stock outstanding and 1.3 million in debt outstanding. the interest rate on the debt is 6 % and no taxed. if ebit is 200,000 - calculate the EPS for each plan.

if ebit is 400,000 what is eps for each plan

what is the break -even EBIT?

i am having the most difficulty with the third part, calculating the break even. I dont understand how to solve the equation.

i have ebit/150,000 = (ebit - .06(1,300,000)/105,000. but i dont know how to solve it. it doesn't come out correctly.

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