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K LTo. Has currently,ajequily share capital of Fs. 25 lakhs, consisting of 26000 shares of Rs. 100 each. The mariagement is planning to raice another
K LTo. Has currently,ajequily share capital of Fs. 25 lakhs, consisting of 26000 shares of Rs. 100 each. The mariagement is planning to raice another Ry 20 fakis to finance major programme of expansion through one of the four possible financtal plans 1103 (a) Entirely through equity shares. (b) Rs. 10 takhs through equity shares and Rs. 10 takhs through long-term borrowings at 8% interest. (c) Rs 5 lakhs through equity shares and Rs. 15 lakhs through long-term borrowing at 9 percent interest (d) Rs. 10 lakhs through equity shares and Rs. 10 lakhs through preference shares with 5% dividend: The company's expected EBII will be Rs. 8 takhs. Assuming a corporate tax rate of Rs. 46%. Determine the EPS in each alternative and comment Which alternative is best and why
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