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A) B) C) Oak Farms is an unlevered firm with 1550 shares outstanding and an EBIT of 625. Corporate earnings are taxed at a rate
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Oak Farms is an unlevered firm with 1550 shares outstanding and an EBIT of 625. Corporate earnings are taxed at a rate of 33%. Calculate EPS for Oak Farms. $ Note: Your answer should be in dollars and cents. For example, $0.99 Suppose that Oak Farms makes a decision to partition (split) its assets into debt and equity. The firm issues $2150 of debt at a cost of 7.35%, and uses these funds to reduce the amount of equity on its books. The partition does not change the EBIT or the tax rate, but does reduce the number of shares outstanding to 800. Compute Oak Farms EPS after the partition. $ Note: Your answer should be in dollars and cents. You Must Get Both Parts Correct to Receive Credit Barry Modin bought 500 of Gingridge LLC at a price of $41.00 about 5 years ago that sell for $66.75 per share today. Barry pays capital gains tax at the rate of 15%, and pays tax on dividends at the rate of 25%, Suppose the Gingridge pays a dividend per share of $3.50. How much of the total dividend paid by the company to Barry will he get to keep? $ Place your answer in dollars and cents without a comma or dollar sign. Shawn Daily was given a gift of Giggle stock by his uncle several years ago at a price of $41.25 per share. Giggle sells today for $68.40 per share. Shawn is taxed on capital gains at the rate of 23%, and is taxed on dividends at the rate of 33%. Shawn uses the dividends from Giggle to meet certain expenditures, and is disappointed to learn that Giggle will forego a dividend this year. To counteract the decision by Giggle, Shawn sells 25 shares of Giggle stock. How much of the total amount of proceeds from those shares will Shawn get to keep? $ Place your answer in dollars and cents without a comma or dollar signStep by Step Solution
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