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MNLOP has 50,000 shares outstanding that sell for $30 each. The firm has an operating income of $100,000 and pays no taxes. The firm contemplates

MNLOP has 50,000 shares outstanding that sell for $30 each. The firm has an operating income of $100,000 and pays no taxes. The firm contemplates a restructuring that would have 40% debt which will be used to repurchase stock. The cost of debt is 7%. Determine the value of the firm, EPS, and rate of return on the stock before and after the proposed restructuring.

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