Problem 1 (20 points) Consider the below table. All monetary values are in CAD. Current Plan Proposed Plan Assets CAD 5 million CAD 5 million Debt CADO CAD 1500000 Equity CAD 5 million CAD 3500000 Debt to Equity Ratio 0 CALCULATE Net Sales Revenue (Recession) CAD 350000 CAD 500000 Net Sales Revenue (Expansion) CAD 580000 CAD 670000 Shares Outstanding 150000 100000 Total Expenses (Recession) CAD 120000 CAD 280000 Total Expenses (Expansion) CAD 180000 CAD 310000 Interest Rate 5% 5% Required: 1) Calculate the Debt to Equity Ratio for the proposed plan. 2) Prepare the current capital structure and the proposed capital structure. Compare between both structures under the 2 given economic situations. 3) What is the variability in ROE and EPS. Explain with numbers. 4) Calculate the breakeven EBIT. Interpret your results. 5) Based on your calculation, why is leveraging essential in financial decisions? 6) Is there risk of financial distress for this company. Explain in details