Question
Simone's Sweets is an all-equity firm that has 8,500 shares of stock outstanding at a market price of $26 per share. The firm's management has
Simone's Sweets is an all-equity firm that has 8,500 shares of stock outstanding at a market price of $26 per share. The firm's management has decided to issue $80,000 worth of debt at an interest rate of 8 percent. The funds will be used to repurchase shares of the outstanding stock. What are the earnings per share at the break-even EBIT?
Multiple Choice
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$2.08
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$3.53
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$2.50
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$5.75
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$3.26
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Modern Advanced Accounting In Canada
Authors: Hilton Murray, Herauf Darrell
7th Edition
1259066487, 978-1259066481
