None Lenow Drug Stores and Hall Pharmaceuticals are competitors in the discount drug chain store business. The separate capitalstructures for Lenow and Hall are presented here.LenowHallDebt @ 10%Common stock, $10 parTotal$ 140,000280,000$ 420,000Debt @ 10%Common stock, $10 parTotalCommon shares28,000Common shares$ 280,000140,000$ 420,00014,000a. Complete the following table given earnings before interest and taxes of $18,000, $42,000, and $59,000. Assume the tax rate is 30percent.Note: Negative amounts should be indicated by parentheses or a minus sign. Round your answers to 2 decimal places. Leave nocells blank be certain to enter O wherever required.EBIT$ 18,000 $Total Assets420,000EBIT/TA%Lenow EPSHall EPS%$42,000 $420,000%What is the relationship between theEPS of the two firms?Lenow EPS > Hall EPSLenow EPS = Hall EPS$59,000 $420,000%Lenow EPS

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Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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