Black Berry Farms and Pea Pod Farms are each able to generate EBIT of $$204,000.$ The separate capital structures for Black Berry

and Pea Pod are presented below.

a$.$ Compute EPS for both firms $($assume a $40$ percent tax rate$).($Round the final answers to $2$ decimal places.$)$

b$.$ Assuming a P$/$E ratio of $27$ for each firm, what would be each firm's share price? $($Round your intermediate calculations and final

answers to $2$ decimal places.$)$

Share price

c$.$ Assume the P$/$E ratio would be $22$ for the riskier company in terms of heavy debt utilization in the capital structure and $35$ for the

less risky firm. What would the share price now be for each firm? $($Round your intermediate calculations and final answers to $2$

decimal places.$)$

Share price

d$.$ This part of the question is not part of your Connect assignment.