DFL and graphical display of financing plans Wells and Associates has EBIT of $66,400. Interest costs are $18,100, and the firm has 14,300 shares of common stock outstanding. Assume a 40% tax rate. a. Use the degree of financial leverage (DFL) formula to calculate the DFL for the firm. b. Using a set of EBIT-EPS axes, plot Wells and Associates' financing plan. c. If the firm also has 1,300 shares of preferred stock paying a $6.00 annual dividend per share, what is the DFL? d. Plot the financing plan, including the 1,300 shares of $6.00 preferred stock, on the axes used in part (b). e. Briefly discuss the graph of the two financing plans. a. The degree of financial leverage is 1.37. (Round to two decimal places) b. Which of the following EBIT-EPS plots correctly depicts Wells and Associates' financing plan? | (Select from the drop-down menu.) Graph 1 Graph 2 Graph of Financing Plan Graph of Financing Plan 2. 2.5 0.5- 0.5- Click to select your answer(s) and then click Check