Integrative Optimal capital structure Medallion Cooling Systems, Inc., has total assets of $9,000,000, EBIT of $1,960,000, and preferred dividends of $196,000 and is taxed at a rate of 40%. In an effort to determine the optimal capital structure, the firm has assembled data on the cost of debt, the number of shares of common stock for various levels of indebtedness, and the overall required return on investment Capital structure debt ratio Cost of debt, Required return, OX 11.9% 7.9 Number of common stock shares 197.000 166,000 140,000 112,000 Am 45 9.2 11.9 140 15.8 Lapitan suructure debt ratio 0% Cost of debt, rd 0% Number or common stock shares 197,000 166,000 140,000 112,000 80,000 7.9 9.2 11.9 14.9 Required return, s 11.9% 13.3 142 15.8 19.8 30 45 00 a. Calculate earnings per share for each level of indebtedness. b. Use the equation Po-EPS Ir, and the earnings per share calculated in part (a) to calculate a price por share for each level pl indebtedness. c. Choose the optimal capital structure. Justify your choice