Rise Against 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 185000 shares of stock outstanding. Under Plan II there would be 135000 shares of stock outstanding and $2.70 million
in debt outstanding. The interest rate on the debt is 5 percent and there are no taxes.
If EBIT is $375000 what is the EPS for each plan? (Round your answers to 2 decimal
If EBIT is $625000 what is the EPS for each plan? (Round your answers to 2 decimal
What is the break-even EBIT? (Do not round intermediate calculations. Enter your answer in
dollars not millions of dollars i.e. 1234567.)