20.2 A company's present capital structure consists of 1,000,000 shares of equity stock. It requires 10 million of external financing for which it is considering three alternatives. Alternative A calls for issuing 1,000,000 equity shares (10 par); alternative B calls for issuing 600,000 equity shares (10 par) and 400,000 preference shares (10 par) carrying 11 percent dividend; alterna- tive C calls for issuing 200,000 equity shares (10 par) and 8 million of debentures carrying 15 percent interest. The company's tax rate is 50 Required: percent. (a) What is the EPS - PBIT equation for alternatives A, B, and C? (h) Rank the alternatives according to EPS over varying levels of PBIT. shares (10 par) selli