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Please fill in the table after reviewing the EPS/EBIT material in Chapter 8 of our text. Company B needs to raise $1B. The company senior
Please fill in the table after reviewing the EPS/EBIT material in Chapter 8 of our text. Company B needs to raise $1B. The company senior executives are not concerned about a recession. There are basically two future earnings expectations. If business activity stays the same, Company B will earn $800 million dollars before interest and taxes. If business activity increases, it is projected that Company B will earn $1.2B dollars before interest and taxes. You need to make a recommendation regarding the best way to raise the $1B. Should the company issue additional stock or should the company borrow the money? Once you have calculated the necessary figures and compared your results, make a recommendation to Company B's Board of Directors. $ Amount Needed: $1000 (M) Stock Price: $40 per share Tax Rate: 40% Interest Rate: 5% Shares Outstanding: 466 (M) Common Stock Financing Normal Boom Debt Financing Normal Boom EBIT Interest EBT Taxes EAT # shares EPS My recommendation is that Company B should to raise the $1B
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