GTB, Inc., has a 20 percent tax rate and has $68.80 million in assets, currently financed entirely with equity. Equity is worth $6 per share, and book value of equity is equal to market value of equity. Also, lets assume that the firms expected values for EBIT depend upon which state of the economy occurs this year, with the possible values of EBIT and their associated probabilities as shown below:

State	Pessimistic				Optimistic
Probability of state		0.40				0.60
Expected EBIT in state	$	2,601,500			$	14,211,500

The firm is considering switching to a 25-percent-debt capital structure, and has determined that it would have to pay a 12 percent yield on perpetual debt in either event. What will be the level of expected EPS if GTB switches to the proposed capital structure? (Do not round intermediate calculations and round your final answer to 2 decimal places.)

I'm having trouble answering this question and feel like I'm making it more difficult than what it needs to be. If someone could explain how they got their answer, I would really appreciate it. Also, below I listed the work that I came up with.

Present Value: 68.8 M

Share Price: $6

Total # Of Shares: 68,800,000 / 6 = 11466666.67

Expected EBIT: (.40 x 2,601,500) + (.60 x 14,211,500) = 9,687,500