Universal Inc. is considering to two financing alternatives to acquire a new firm to combine with its existing operations. Given the select financial information below, calculate the firm's coverage ratios under each of the financing alternatives. The acquisition price ($million) $1,800 $1,000 Universal's expected EBIT in 2022 after the acquisition No. shares outstanding (millions) Dividends per share. 80 $1.50 Alt. 1: Equity financing ($million) $1,800 Universal's stock price $100 No. of new shares to be issued (millions) 18.0 Alt. 2: Debt financing ($million) $1,800 Interest rate on new debt 10.00% New principal repayment ($million) $100 Tax rate 30% 2022 Projected Alt. 1: Equity financing Interest-bearing debt outstanding Interest expense Principal payments Shareholders' equity (book value) Common shares outstanding Dividends paid at $1.50 per share Before new financing $1,525 $85 $50 $1,255 80 $120 Alt. 2: Debt financing Financial obligations Interest expense Principal payment Common dividends Times interest earned Times burden covered Times common covered Alt. 1: Equity financing Before tax Alt. 1: Equity financing Percentage EBIT can fall #DIV/0! #DIV/0! #DIV/0! After tax Coverage $0 $0 $0 Alt. 2: Debt financing Before tax Alt. 2: Debt financing After tax Coverage $0 $0 $0 Percentage EBIT can fall #DIV/0! #DIV/0! #DIV/0