Consider a firm with an EBIT of $$866,000.$ The firm finances its assets with $$2,660,000$ debt $($costing $8$ percent and is all tax deductible$)$ and $560,000$ shares of stock selling at $$5\mathrm{.}00$ per share. To reduce the firm$$s risk associated with this financial leverage, the firm is considering reducing its debt by $$1,000,000$ by selling an additional $360,000$ shares of stock. The firm$$s tax rate is $21$ percent. The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $$866,000.$

Calculate the change in the firm$$s EPS from this change in capital structure. $($Do not round intermediate calculations and round your final answers to $2$ decimal places.$)$Consider a firm with an EBIT of $$866,000.$ The firm finances its assets with

$$2,660,000$ debt $($costing $8$ percent and is all tax deductible$)$ and $560,000$

shares of stock selling at $$5\mathrm{.}00$ per share. To reduce the firm's risk

associated with this financial leverage, the firm is considering reducing its

debt by $$1,000,000$ by selling an additional $360,000$ shares of stock. The

firm's tax rate is $21$ percent. The change in capital structure will have no

effect on the operations of the firm. Thus, EBIT will remain at $$866,000.$

Calculate the change in the firm's EPS from this change in capital

structure. $($Do not round intermediate calculations and round your final

answers to $2$ decimal places.$)$

Answer is complete but not entirely correct.