7. CMC Company has $40 million is assets and EBIT of $4.0 million. If CMC 's debt ratio (D/TA) is 50%, the interest it pays on its debt is 10% and there will be 400,000 shares of stock outstanding, where if the debt ratio is 35%, interest is 7.0% and outstanding shares will be 600,000 . CMC's marginal tax rate is 40%. Calculate CMC's EPS and and ROE (Net Income/Equity) for each capital structure and which capital structure is better