Question: Haskell Corp. is comparing two different capital structures. Plan I would result in 10,000 shares of stock and $100,000 in debt. Plan II would result

Haskell Corp. is comparing two different capital structures. Plan I would result in 10,000 shares of stock and $100,000 in debt. Plan II would result in 5,000 shares of stock and $200,000 in debt. The interest rate on the debt is 6 percent. a. Ignoring taxes, compare both of these plans to an all-equity plan assuming that EBIT will be $60,000 The all-equity plan would result in 15,000 shares of stock outstanding. What is the EPS for each of these plans? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g. 32.16.) Plan I Plan II All equity 5.40 9.60 b. In part (a), what are the break-even levels of EBIT for each plan as compared to that for an all-equity plan? (Do not round intermediate calculations.) EBIT Plan I and all-equity Plan II and all-equity C. Ignoring taxes, at what level of EBIT will EPS be identical for PlansI and II? (Do not round intermediate calculations.) 18000 EBIT d-1 Assuming that the corporate tax rate is 40 percent, what is the EPS of the firm? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) Plan I Plan II All equity d-2 Assuming that the corporate tax rate is 40 percent, what are the break-even levels of EBIT for each plan as compared to that for an all-equity plan? (Do not round intermediate calculations.) EBI Plan I and all-equity Plan Il and all-equity d-3 Assuming that the corporate tax rate is 40 percent, when will EPS be identical for Plans I and l? (Do not round intermediate calculations.)
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