Manly Manufacturing is comparing two different capital structures.Plan I would result in 23 000 shares and $320 000 in debt.Plan II would result in 17 000 shares and $260 000 in debt.The interest rate on the debt is 10 per cent.Ignoring taxes,EPS will be identical for Plans I and II when EBIT equals which one of the following?
A)$9000
B)$10 750
C)$8550
D)$10 400
E)$9600

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The Answer of Manly Manufacturing is comparing two different capital structures.Plan I would result in 23 000 shares and $320 000 in debt.Plan II would result in 17 000 shares and $260 000 in debt.The interest rate on the debt is 10 per cent.Ignoring taxes,EPS will be identical for Plans I and II when EBIT equals which one of the following?
A)$9000
B)$10 750
C)$8550
D)$10 400
E)$9600

Manly Manufacturing Is Comparing Two Different Capital Structures