Ph Co. has an 8% debt with a book value of 8 M and a common stock of 8.5 M with outstanding shares of 370,000. The expected level of EBIT after the expansion is 3.5 M. The income tax rate is 25%. The firm is considering a 12 M expansion program using one of the following:
Plan 1 – Incur additional debt at 10% interest;
Plan 2 – Sell preferred shares with an 11.5% dividend yield; and
Plan 3 – Sell new common stock at 25 per share.
How much is the EPS for Plan 1?
Analyzing the rates of return on United Futon’s ordinary shares over 60 months indicates a beta of 1.45 and an alpha of -0.2% per month. The following month, the market rose by 5 percent and United Futon by 6 percent. What is Futon’s abnormal rate of return?
Which of the following ratios measures the earning ability of a company?
A) The acid-test ratio
B) The times-interest-earned ratio
C) The current ratio
D) The price-earnings ratio
Order an Essay Now & Get These Homework Help Features For Free:
Turnitin Report
Formatting
Title Page
Citation
Outline
