Oak Farms is an unlevered firm with 3055 shares outstanding and an EBIT of 675. Corporate earnings are taxed at a rate of 33%. Note: Your answer should be in dollars and cents. For Calculate EPS for Oak Farms. $ example, $0.99. Suppose that Oak Farms makes a decision to partition (split) its assets into debt and equity. The firm issues $1650 of debt at a cost of 7.70%, and uses these funds to reduce the amount of equity on its books. The partition does not change the EBIT or the tax rate, but does reduce the number of shares outstanding to 2305. Note: Your answer should be in dollars and Compute Oak Farms EPS after the partition. S cents. You Must Get Both Parts Correct to Receive Credit Santos Unlimited (SU) was originally unlevered with 4200 shares outstanding. However, after a major financial restructure, SU now has $37000 of debt, with an annual interest expense of 12 percent. The restructuring has reduced the number of shares to 3200. A group of shareholders of SU are not convinced that this move towards adopting financial leverage is a good idea. Their main argument is that there is now some range of EBIT, however low, that will make the shareholders worse off than before. Help understand the situation better by computing the level of earnings before interest and tax (EBIT) that would make shareholders indifferent between being unlevered (i.e. not having any debt) and levered (i.e. having debt). Assume a 33 percent corporate tax rate. Answer: $ Place your answer to the nearest dollar without a dollar sign or a comma (if applicable)