Question
Green Co. has total debt of $400,000, a cost to borrow funds of 6%, and an EBIT of $42,500. From a financial perspective, Green Co.
Green Co. has total debt of $400,000, a cost to borrow funds of 6%, and an EBIT of $42,500. From a financial perspective, Green Co. has profits at
A. breaking even.
B. lower than the breakeven point.
C. higher than the break-even point.
D. in need of new financing.
PLEASE EXPLAIN THE ANSWER!!! thank you!!!!
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Corporate Finance Reader
Authors: Robert W. Kolb
2nd Edition
1878975536, 978-1878975539
