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Business, 27.06.2019 20:10 ariyanna029

Lenow’s drug stores and hall’s pharmaceuticals are competitors in the discount drug chain store business. the separate capital structures for lenow and hall are presented next. lenow hall debt @ 10% $ 80,000 debt @ 10% $ 160,000 common stock, $10 par 160,000 common stock, $10 par 80,000 total $ 240,000 total $ 240,000 common shares 16,000 common shares 8,000a. complete the following table given earnings before interest and taxes of $13,000, $24,000, and $53,000. assume the tax rate is 30 percent. (leave no cells blank - be certain to enter "0" wherever required. negative amounts should be indicated by a minus sign. round your answers to 2 decimal places.) ebit total assets ebit/ta lenow eps hall eps what is the relationship between the epsof the two firms? $ 13,000 $240,000 % $ $ $ 24,000 $240,000 % $ $ $53,000 $240,000 % $ $ b-1. what is the ebit/ta rate when the firm's have equal eps? ebit/ta rate %b-2. what is the cost of debt? cost of debt %b-3. state the relationship between earnings per share and the level of ebit. eps is unaffected by financial leverage when the pre-tax return on assets (ebit/ta)the cost of debt. c. if the cost of debt went up to 12 percent and all other factors remained equal, what would be the break-even level for ebit? break-even level $

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