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Dickson Corporation is comparing two different capital structures. Plan I would result in 3 2 , 0 0 0 shares of stock and $ 9

Dickson Corporation is comparing two different capital structures. Plan I would result in 32,000 shares of stock and $94,500 in debt. Plan II would result in 26,000 shares of stock and $283,500 in debt. The interest rate on the debt is 4 percent. Assume that EBIT will be $125,000. An all-equity plan would result in 35,000 shares of stock outstanding. Ignore taxes. What is the price per share of equity under Plan I? Plan II?

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