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Pulp Paper Company and Holt Paper Company are each able to generate EBIT of $198,000. The separate capital structures for Pulp and Holt are presented

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Pulp Paper Company and Holt Paper Company are each able to generate EBIT of $198,000. The separate capital structures for Pulp and Holt are presented below. Pulp Holt Debt @ 9% Common stock $1,150,000 1,050,000 Debt @ 9% Common stock $750,000 1,450,000 Total $2,200,000 Total $2,200,000 Common shares 210,000 Common shares 290,000 a. Compute EPS for both firms (assume a 40 percent tax rate). (Round the final answers to 2 decimal places.) Holt Pulp $ EPS b. Assuming a P/E ratio of 32 for each firm, what would be each firm's share price? (Do not round intermediate calculations. Round the final answers to 2 decimal places.) Pulp Holt Share price c. Assume the P/E ratio would be 22 for the riskler company in terms of heavy debt utilization in the capital structure and 33 for the less risky firm. What would the share price now be for each firm? (Do not round intermediate calculations. Round the final answers to 2 decimal places.) Holt Pulp $ Share price $

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