Wingler Communications Corparation (wCC) produces alpods that sell for s28.70 per set, and this year's sales are essected to be 440,000 units. Variable production costs for the expected sales under present production methods are eitimated at 510,500,000, and fixed aroduction (operating) costs at present are 11,560,000. wCC has 14,800,000 of debt outstancing at an interest rate of 7 th. There are 240,000 shares of common stock eututanding, and there is ns preferred stock. The dividend payout ratio is 70%, and wCC. is in the 25% federal-plus-state tax bracket. WCC is a small company with average sales of 525 million or less duning the past 3 reach, so it is exempt from the interest deduction fimitation. The compony is considering investing 57,200,000 in new equipment. Soles weuld not increase, but variable costs ser unit would decline by 20\%. Also, fived operabing costs would increase from 51,560,000 to $1,800,000. wCC could raise the required capcal by borrowing $7,200,000 at 10% or by seiling 240,000 additional shares of common stock at 530 per share. a. What would be wCCs EDS (1) under the old production process, (2) under the new process it it uses debt, and (3) under the new process if it uses common stock? Do not round intermediate calculations. Round your answers to the nearest cent. 1. 5 2. 3 3. 5 b. At what unit sales level would wCC have the same EPS assuming it undertakes the invertment and finances it with cebt or with solve for Q.) Do net round intermediate calculations. Round your answer to the nearest whole number. units c. At what unit sales level would EPS = 0 under the three production/financing setups - that is, under the old plan, the new plan wikh debt financing, and the new plan with stock financing? (Mint: Note that Voic =110,500,000/440,000, and use the hints for part D, setting the EPS equation equal to zero.) Do not pound intermediate culculations. Round your answirs to the nearest whole number Old plan: units New plan with debt financing: units New plan with stock finanong: unts d. On the basis of the analysis in parts a through c, and given that operating leverage is lower under the new setup, which plan is the riskiest, which has the highest expected EPS, and which would you recommend? Assume that there is a fairly high probability of sales falling as low as 250,000 units. Determine EPS Deth and EPS seeck at that sales level to help assess the riskiness of the two financing plans. Negative values stould be indicated by a minus sign. Do not round intermediate calculations. Round your answars to the nearest cent. epsoebt: 5 EPstack: 5