Lear Incorporated has $$890,000$ in current assets, $$395,000$ of which are considered permanent current assets. In addition, the firm has $$690,000$ invested in fixed assets.

a$.$ Lear wishes to finance all fixed assets and half of its permanent current assets with long$-$term financing costing $10$ percent. The balance will be financed with short$-$term financing, which currently costs $4$ percent. Lear's earnings before interest and taxes are $$290,000.$ Determine Lear's earnings after taxes under this financing plan. The tax rate is $40$ percent.

Earnings after taxes????????

b$.$ As an alternative, Lear might wish to finance all fixed assets and permanent current assets plus half of its temporary current assets with long$-$term financing and the balance with short$-$term financing. The same interest rates apply as in part a$.$ Earnings before interest and taxes will be $$290,000.$ What will be Lear's earnings after taxes? The tax rate is $40$ percent.

Earnings after taxes $?????????$