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Please assist and show your work as well. Thank you. The probability distribution for annual sales is as follows: Probability 0.30 0.30 Annual Sales (Millions
Please assist and show your work as well. Thank you.
The probability distribution for annual sales is as follows: Probability 0.30 0.30 Annual Sales (Millions of Dollars) $2,250 2,700 3,150 Assuming that EBIT equals 10% of sales, calculate earnings per share (EPS) under the debt financing and the stock financing alternatives at each possible sales level. Do not round intermediate calculations. Round your answers to two decimal places. Write out your answer completely. For example, 0.00013 million should be entered as 130. Annual Sales EPS under EPS under (Millions of Dollars) the debt financing the stock financing $2,250 2,700 3,150 Calculate expected EPS under both debt and stock financing alternatives. Do not round intermediate calculations. Round your answers to two decimal places. Write out your answer completely. For example, 0.00013 million should be entered as 130. under the debt financing expected EPS is under the stock financing expected EPS is Calculate under both debt and stock financing alternatives. Do not round intermediate calculations. Round your answers to two decimal places. Write out your answer completely. For example, 0.00013 million should be entered as 130. under the dept financing is under the stock financing is Calculate the debt-to-capital ratio and the times-interest-earned (TIE) ratio at the expected sales level under each alternative. The old debt will remain outstanding. the denominator of the debt-to-capital ratio.) Do not round intermediate calculations. Round your answers to two decimal places. under the debt financing: The debt ratio is Times-interest-earned ratio is under the stock financing: The debt ratio is Times-interest-earned ratio is Which financing method do you recommend? Equity [Hint: Notes payable should be included in both the numerator and
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