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Question 23 (1 point) South Side Corporation has no debt outstanding, a total value of...

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Question 23 (1 point) South Side Corporation has no debt outstanding, a total value of assets of $500.000. a total market value of the firm of $300,000, a market-to-book ratio of 1.0, a dividend payout ratio of 100 percent, and a corporate income tax rate of 40 percent. Earnings before interest and taxes are expected to be $45,000 per year forever. South Side is considering a $210,000 debt issue with an 8 percent interest rate. If issued, the proceeds from this debt would be used to repurchase shares of common stock and the bankruptcy tax rate will be 25 percent. There are currently 3,000 shares of common stock outstanding. Assume that South Side goes through with the recapitalization. What is numerical value of the value of the bankruptcy claims after the debt has been issued? $17,500 $45,000 $80,000 O $100,000 O $70,000

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