Trapper Corporation is comparing two different capital structures an all- equity plan (Plan l) and a levered plan (Plan ll). Under Plan l,the company would have 200 000 shares of stock outstanding and $2.2 million in debt outstanding. The interest rate on the debt is 5 percent, and there are no taxes

a. If EBITis $350,000, what is the EPS for each plan ?

b. If EBIT is $600,000 ,what is the EPS for each plan?

c. What is the break-even EBIT?

a. Plan l EPS Plan ll EPS b. Plan l EPS Plan ll EPS c. Break-even EBIT

okmarks Top 10 Ways to Imp. http://ic.galegroup. Toolwire My Verizon Home. Apply: Assessment [due Mon] 6 Saved Help Sev Trapper Corporation is comparing two different capital structures, an all-equity plan (Plan I) and a levered plan (Plan II). Under Plan I, the company would have 200,000 shares of stock outstanding. Under Plan II, there would be 150,000 shares of stock outstanding and $2.2 million in debt outstanding. The interest rate on the debt is 5 percent, and there are no taxes. a. If EBIT is $350,000, what is the EPS for each plan? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) b. If EBIT is $600,000, what is the EPS for each plan? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) c. What is the break-even EBIT? (Do not round intermediate calculations. Enter your answer in dollars, not millions of dollers, e.g., 1,234,567.) kipped Plan I EPS a. Plan I| EPS Plan I EPS b. Plan II EPS Break-even EBIT C