Destin Corp. compares two different capital structures. Plan I would result in 10,000 stocks and $90,000 in debt. Plan II would result in 7,600 stocks and $198,000 in debt. The interest rate on the loan is 10 percent.

A.	Ignoring taxes, compare both plans with an all-equity plan assuming an EBITDA of $48,000. The all-equity plan will result in 12,000 shares outstanding. What is the EPS for each of these plans? (Round your answers to 2 decimal places (eg 32.16))

	EPS
plan i	$
Plan II	$
All equity	$

B.	In part (a), what are the breakeven levels of EBITDA for each plan compared to an all equity plan?

	CHIEFS
Plan I and wholly equity	$
Plan II and wholly equity	$

C.	At what EBIT level will EPS be the same for Plans I and II, ignoring taxes?

CHIEFS

$

d-1	Assuming the corporate tax rate is 40 percent, what is the firm's EPS? (Round your answers to 2 decimal places (eg 32.16))

	EPS
plan i	$
Plan II	$
All equity	$

d-2	Assuming the corporate tax rate is 40 percent, what are the breakeven levels of EBIT for each plan compared to an all-equity plan?

	CHIEFS
Plan I and wholly equity	$
Plan II and wholly equity	$

d-3	Assuming the corporate tax rate is 40 percent, when will EPS be the same for Plans I and II?

CHIEFS

$