P13-11 EPS Calculations.xlsx - P13-11 EPS Calculations...

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P13-11 EPS Calculations Southland Industries has $60,000 of 6% (annual interest) bonds outstanding, 1,500 shares of preferred $5 per share, and 4,000 shares of common stock outstanding. Assuming that the firm has a 40% tax rat for the following levels of EBIT: EBIT: $60,000 outstanding bond amount 6% bond annual interest rate 1 interest payment per year 1,500 outstanding shares of preferred stock 5.00 preferred stock dividend per share 4,000 outstanding shares of common stock 40% tax rate a. $24,600 $ 24,600 EBIT $ 3,600 Interest $ 21,000 Net profits before taxes $ 8,400 Tax $ 12,600 Net profits after taxes $ 7,500 Preferred dividends

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