Question
To find the breakeven EBIT for two different capital structures, we simply set the equations for EPS equal to each other and solve for EBIT.
To find the breakeven EBIT for two different capital structures, we simply set the equations for EPS equal to each other and solve for EBIT. The breakeven EBIT is:
EBIT/265,000 = [EBIT - 0.10($2,800,000)]/185,000
EBIT = $927,500
Can someone break it down for me?
step-by-step. I don't understand how they got the answer. Thanks
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Financial Management Core Concepts
Authors: Raymond M Brooks
2nd edition
132671034, 978-0132671033
