Use the data in the paragraph below and the information in the table below to answer questions 11, 12 and 13:

Wesley, Inc. is a levered firm with $60,000 of total assets and $20,000 of debt in its balance sheet. The firm faces EBIT scenarios of recession and boom. The corporate tax rate is 32%. {Note: EBIT = Earnings before Interest and Tax, NIBT = Net Income Before Tax, NI = Net Income, and EPS = Earnings Per Share}

EBIT $ INTEREST NIBT TAXES NI EPS

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RECESSION - $6,000(EBIT). $3,000(INTEREST) $1.36(EPS)

BOOM. $1,600(TAXES)

What amount comes closest to Wesleys $INTEREST in the BOOM scenario?

a. $1,000

b. $1,500

c. $2,225

d. $2,500

e. $3,000

What amount comes closest to Wesleys EPS in the BOOM scenario?

a. $0

b. $1.96

c. $2.04

d. $2.27

e. $3.40

What amount comes closest to Wesleys number of shares outstanding?

a. 975

b. 1,060

c. 1,500

d. 1,666

e. 2,033