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Loving Gardens ( LG ) has $ 5 million in assets, $ 6 0 0 , 0 0 0 EBIT, and a marginal tax rate

Loving Gardens (LG) has $5 million in assets, $600,000 EBIT, and a marginal tax rate equal to 40 percent. If LG's debt ratio (D/TA) is 40 percent, interest on its debt is 10 percent, whereas if the debt ratio is 60 percent, interest is 13 percent. LG will have 60,000 shares of stock outstanding if it is financed with 40 percent debt, but it will have 57,000 shares outstanding with 60 percent debt. Calculate LG's EPS aincome/Equity) for each capital structure. Do not round intermediate calculations. Round your answers for EPS to the nearest cent and for ROE to two decimal places.nd ROE (ROE = Net income/Equity) for each capital structure. Do not round intermediate calculations. Round your answers for EPS to the nearest cent and for ROE to two decimal places.
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