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Lenow’s Drug Stores and Hall’s Pharmaceuticals are competitorsin the discount drug chain store business. The separate capitalstructures for Lenow and Hall are presented here.LenowHallDebt @ 10%$110,000Debt @ 10%$220,000Common stock, $10 par220,000Common stock, $10 par110,000Total$330,000Total$330,000Common shares22,000Common shares11,000a. Complete the following table given earningsbefore interest and taxes of $15,000, $33,000, and $56,000. Assumethe tax rate is 30 percent. (Negative amounts should beindicated by parentheses or a minus sign. Roundyour answers to 2 decimal places.) b-1. What is the EBIT/TA rate when the firm's haveequal EPS? b-2. What is the cost of debt? b-3. State the relationship between earnings pershare and the level of EBIT. c. If the cost of debt went up to 12 percent andall other factors remained equal, what would be the break-evenlevel for EBIT? rev: 02_14_2018_QC_CS-118192