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Lenow's Drug Stores and Hall's 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's Drug Stores and Hall's Pharmaceuticals are competitors in the discount drug chain store business. The separate capital structures for Lenow and Hall are presented here. Lenow Hall Debt a 10% 110,000 10% $220,000 220,000 common stock, $10 par Common stock, $10 par 110,000 330,000 Total $330,000 Total 11,000 Common shares 22,000 Common shares a. Complete the following table given earnings before interest and taxes of $15,000, $33,000, and $56,000. 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 Hall EPS EBIT Total assets the EPS of the two firms? 15,000 330,000 330000 33,000 56,000 s 330,000 b-1. What is the EBITITA rate when the firm's have equal EPS? EBIT/TA rate b-2. What is the cost of debt? Cost of debt b-3. State the relationship between earnings per share and the level of EBIT. EPS is unaffected by financial leverage when the pre-tax return on assets (EBITITA) the cost of debt

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