Question
Plan 1: Debt: $20,000 at 9% Preferred Stock: 100 Shares, Dividend per Share = $3 Common Stock: 3,000 Tax Rate: 40% Plan 2: Debt: $10,000
Plan 1:
Debt: $20,000 at 9%
Preferred Stock: 100 Shares, Dividend per Share = $3
Common Stock: 3,000
Tax Rate: 40%
Plan 2:
Debt: $10,000 at 5%
Preferred Stock: 200 Shares, Dividend per Share = $3
Common Stock: 5,000
Tax Rate: 40%
How do you find the Indifference EBIT?
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Personal Financial Planning
Authors: Randy Billingsley, Lawrence J. Gitman, Michael D. Joehnk
14th edition
978-1305887725, 1305887727, 1305636619, 978-1305636613
