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An all equity corporation with a market value of 375000s has EBIT of $60000 and 5000 shares outstanding. Assume a corporate tax rate of 40%. If the firm borrows $140000 @6 percent interest to buy back

An all equity corporation with a market value of 375000s has EBIT of $60000 and 5000 shares outstanding. Assume a corporate tax rate of 40%. If the firm borrows $140000 @6 percent interest to buy back some of its stock? 1. Compute the current net income and EPS (show the steps of computation ) (2 points) 2. Number of shares repurchased (show the steps of computation ) ( points) 3. Compute the net income and EPS after capital structure change (show the steps of computation 

Apr 12 2021 View more View Less

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