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  • Apr 7, 2012, 08:50 PM
    lovelytilltheen
    Ebit indifference level calculator
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    Financing help needed for EBIT?

    Scenario A: 2.1 million raised by selling common stock at $20 a share
    Scenario B: 1.1 million raised by selling bonds with an interest rate of 10.6% (per annum) remaining 1 million would be raised by selling common stock at $20 per share. A 34% tax rate is deemed appropriate.

    Find the EBIT indifference level between the two scenarios

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