Capital Structure L Corporation has total assets of P100 million. Earnings before interest and taxes were P20 million and the tax rate was 35%. Given the following leverage ratios and corresponding interest rates, calculate Litton's rate of return on equity for each amount of debt. Leverage Interest Rate (Debt / Total Assets) on Debt 1. 2 3. 4. 5. 0% 10 30 50 60 16 % 16 18 21 What is the optimal capital structure? If you were the finance manager, which capital structure would you choose? Explain