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ces Green Foods currently has $200,000 of equity and is planning an $80,000 expansion to meet increasing demand for its product. The company currently
ces Green Foods currently has $200,000 of equity and is planning an $80,000 expansion to meet increasing demand for its product. The company currently eams $70.000 in net income, and the expansion will yield $35,000 in additional income before any interest expense The company has three options: (1) do not expand. (2) expand and issue $80,000 in debt that requires payments of 11% annual interest. or (3) expand and raise $80,000 from equity financing. For each option, compute (aj net income and (b) return on equity (Net Income- Equity). Ignore any income tax effects. (Round "Return on equity" to 1 decimal place.) Income before interest expense interest expense Net income Equity Return on equity 1.Don't Expand 2 Uslit Financing 3 Equity Financing
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