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Lenow Drug Stores and Hall Pharmaceuticals are competitors in the discount drug chain store business. The separate capital structures for Lenow and Hall are presented

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Lenow Drug Stores and Hall Pharmaceuticals are competitors in the discount drug chain store business. The separate capital structures for Lenow and Hall are presented here. Lenow Debt 10% Common stock, $10 par Total Common shares $ 80,000 Debt 10% 160,000 Comon stock, $10 par $240,000 Total 16,000 Common shares $160,000 30, $240,000 3.000 a. Complete the following table given earnings before interest and taxes of $13.000 $24000, and $53,000. Assume the tax rate is 30 percent. (Negative amounts should be indicated by parentheses or a minus sign. Round your answers to 2 decimal places.) What is the relationship between the EPS of the two finns? EBITITA Lenow EPS Hall EPS EBIT Total Assets 5 13,000 $ 240.000 $ 24 000 $ 240.000 53,000 240,000 Help b-1. What is the EBIT/TA rate when the firm's have equal EPS? EBITITA rate Sok b-2. What is the cost of debt? int Cost of debt b-3. State the relationship between earnings per share and the level of EBIT, EPS is unaffected by financhi lavorage when the peo-tax return on (EBIT/TA) Check b-3. State the relationship between earnings per share and the level of EBIT, EPS is unafected by financial leverage when thin pru-tax return on isset (EBIT/TA) the cost of debt c. If the cost of debt went up to 12 percent and all other factors remained equal, what would be the break.even level for EBIT Break-even loved

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