Phelps Canning Company is considering an expansion of its facilities its current income statement is as follows: Sales Lesst Variable expense (50% of sales) Fixed expense $6,000,000 3,000,000 1,900,000 Earnings before interest and taxes (EBIT) Interest (10% cost) 1,100,000 400,000 Earnings before taxes (ET) Tax (3555 700,000 285,000 Earnings after takes (LAT) $455,000 Share of conon stock IPS 300,000 51:52 Phelps Canning Company is currently financed with 50 percent debt and 50 percent equity (common stock). To expand facilities. Me Phelps estimates a need for $3.0 million in additional financing. His Investment dealer has laid out three plans for him to consider 1. Sell 53.0 million of debt at 12 percent 2. Sel 5310 million of common stock at $20 per share 3. Sell $1.50 man of debt at 11 bercent and $150 million of common stock at $25 per share Variable costs are expected to stay at 50 percent of sales. While fyed expenses will increase to $2.400.000 per year Mc Phelps is not Sute how much this expansion will add to Sales, but he estimates that sales wise by $150 million per year for the next five years Mi Phelos is interested in a thorough analysis of nit expansion plans and methods of financing. He would like you to analyze the following o. The renk even bolnt for operating expertes before and after expansion sales inter the ontwers in dollare not in millions a. The break-even point for operating expenses before and after expansion (in sales dollars) (Enter the answers in dollars not in millions.) Before expansion After expansion b. The DOL before and after expansion Assume sales of $60 million before expansion and $20 million after expansion (Round the final answers to 2 decimal places) DOS Before expansion atter expansion c-1. The DFL before expansion at sales of $60 million (Round the final answers to 2 decimal places.) DFL --2. The DFL for all three methods after expansion Assume sales of $70 milan (Round the final answers to 2 decimal places) sont 05 Debtotoutty d. Compute EPS under all three methods of financing the expanson at $70 min sales mirst year and 511 onih sales last Yen (Round the finalentwerto 2 decimal places 100