answer the question after structure #2

The purpose of this Exercise is to display your knowledge on the topic of capitalization and returns. A former student of mine is attempting to buy 6 Sonics in the Great State of Louisiana. Revenues for the 6 Sonics equal $12 million per year. Earning before taxes equal $2 million per year. Assume the tax rate is 40%. My former student is looking at 2 financial structures to accomplish the acquisition of 6 stores. Assuming the business is sold for $10 million in year 10, how much money did the bank debt receive (principal and interest)? How much money did Seller Paper receive (principal and interest? How much money did the owner of the business receive (earnings/dividends)? Tips - Earnings before interest and taxes = $2mm a year for the next 10 years. Bank debt interest 5%, interest only, bank debt matures in 10 years. Seller Paper interest 7%, interest only, Seller Paper matures in 10 years. Taxes are 40%. Structure #2 Acquisition Price $10 million 100% Equity Financing At the end of 10 years, the owner of the business sells the business for $10 million. How much money will the $10 million Equity Investment earn on a pre-tax and after pre-tax basis? Tips-Industry Sector Earnings before interest and taxes = $2mm a year for the next 10 years. Taxes are 40%. Remember to compare the 2 financing structures. Give me your impressions on the two financial engineering approaches