Question: MOS: Chapter 5 Homework ter 5 Homework Saved Help Lenow Drug Stores and Hall Pharmaceuticals are competitors in the discount drug chain store business. The
MOS: Chapter 5 Homework ter 5 Homework Saved Help Lenow Drug Stores and Hall Pharmaceuticals are competitors in the discount drug chain store business. The separate capital structures for Lenow and Hall are presented here. Lenow Debt 98 Common stock, $10 par Total Common shares Hall $280,000 Debte 98 560,000 Common stock, $10 par $840,000 Total 56,000 Common shares $560,000 280,000 $840,000 28,000 a. Complete the following table given earnings before interest and taxes of $32,000, $75,600, and $82,000. Assume the tax rate is 20 percent. (Negative amounts should be indicated by parentheses or a minus sign. Round your answers to 2 decimal places.) EBITITA % Lenow EPS Hall EPS What is the relationship between the EPS of the two firms? $ $ $ EBI 32,000 75,600 82,000 Total Assets $ 840,000 $ 840,000 $ 840,000 b-1. What is the EBIT/TA rate when the firm's have equal EPS
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