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urgent The Project Manger of HDMI Pro Berhad is planning a RM6,000,000 expansion this year. The expansion can be financed by issuing either common shares

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The Project Manger of HDMI Pro Berhad is planning a RM6,000,000 expansion this year. The expansion can be financed by issuing either common shares or bonds. The new common share can be sold for RM$6 per share. The bonds can be issued with a 12% coupon rates. The firms existing preference share pay dividends of RM$3 per share. The companys corporate income tax is 30%. The financial statement of HDMI Pro Berhad is as follow:-

image text in transcribed HDMI Pro Berhad Balance Sheet as at 31st December 2021 Required: a) Calculate the indifference level of EBIT between the two Plans. b) If EBIT is Expected to be RM1,600,000 which plan will result in a high EPS? c) Calculate the WACC for the company without taking into consideration the expansion plan mentioned above, which means using the original Balance sheet figures. Also, the dividend payment for common stock is 8% and Preferred stock is 5% and the cost of capital for Retained earnings is 7%

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