Question: undefined 1) James Corp is comparing 2 different capital structures: an all equity plan (Plan 1) and a levered plan (Plan II). Under Plan I,

undefined 1) James Corp is comparing 2 different capital structures: an all undefined

1) James Corp is comparing 2 different capital structures: an all equity plan (Plan 1) and a levered plan (Plan II). Under Plan I, the company would have160,000 share of stock outstanding. Under Plan II, there would be 80,000 shares outstanding and $2.8 Min debt outstanding. The interest rate on the debt is 8%, and there are no taxes. a. If EBIT is $350,000, which plan will result in higher EPS? b. If EBIT is $500,000, which plan will result in higher EPS? c. What is the break-even EBIT

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