Marombo Ltd is an all-equity-financed company with 10,000 outstanding ordinary shares, each valued at the market price of R25. The company has decided to modify its capital structure to capture the tax benefits of debt. The plan is to have a target debt ratio of 30%. The company pays 60% of its earnings as dividends and is subject to a 28%company tax rate. The expected sales are R530 000, fixed costs are estimated at R250 000, and variable costs are estimated at 30% of sales. Details of the pursued capital structures are as follows: Capital structure A at 30% debt ratio Marombo Ltd will acquire debt at a before-tax cost of debt of 11.75%. REQUIRED: 3.1 Which capital structure would you advise the company to choose if its objective is to maximise earnings per share (EPS)