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Karie Kul, Inc. sells 400,000 inflatable beach balls annually. Each beach ball has a variable cost of 84 cents and sells for $1.20. Fixed
Karie Kul, Inc. sells 400,000 inflatable beach balls annually. Each beach ball has a variable cost of 84 cents and sells for $1.20. Fixed operating costs total $38,000. Karie Kul, Inc. has $50,000 in bonds outstanding with a coupon rate of 12%. Preferred stock dividends are $3000 and Karie Kul, Inc. has 10,000 shares of common stock outstanding. Assume a 40% tax bracket. If Kari Kul, Inc.'s sales were expected to increase 30%, what would the new level of earnings per share be? O $2.11 $5.18 $8.30 O $11.44
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