Favorable Financial Leverage Paydirt Pete Incorporated (a newly formed corporation) is attempting to determine the appropriate mix of debt and equity. The amount of capital needed is $50 million. The capitalization mix alternatives have been narrowed to: $10 million in debt and $40 million in equity. $30 million in debt and $20 million in equity. Income before interest and taxes will be $8 million. The interest rate on debt is 8%. The income tax rate is 40%. Calculate the net income and return on shareholders' equity for both alternatives