Wagner Industries is comparing two different capital structures. Plan I would result in 9,500 shares of...

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Wagner Industries is comparing two different capital structures.Plan I would result in 9,500 shares of stock and $361,000 in debt.Plan II would result in 12,000 shares of stock and $238,000 indebt. The interest rate on the debt is 10 percent.
     a.         Ignoring taxes,compare both of these plans to an all-equity plan assuming thatEBIT will be $71,000. The all-equity plan would result in 19,000shares of stock outstanding. Which of these three plans has thehighest EPS? The lowest?
     b.         In question (1),what are the break-even levels of EBIT for each plan as compared tothat for an all-equity plan? Is one higher than the other? Why?
     c.         Ignoring taxes,when will EPS be identical for Plans I and II?

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Wagner Industries is comparing two different capital structures.Plan I would result in 9,500 shares of stock and $361,000 in debt.Plan II would result in 12,000 shares of stock and $238,000 indebt. The interest rate on the debt is 10 percent. a. Ignoring taxes,compare both of these plans to an all-equity plan assuming thatEBIT will be $71,000. The all-equity plan would result in 19,000shares of stock outstanding. Which of these three plans has thehighest EPS? The lowest? b. In question (1),what are the break-even levels of EBIT for each plan as compared tothat for an all-equity plan? Is one higher than the other? Why? c. Ignoring taxes,when will EPS be identical for Plans I and II?