Calculate expected eps

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Reference no: EM132341457

Date Wireless has the following assets:

Current assets:

Temporary$1,190,000 Permanent1,380,000 Capital assets7,950,000 Total assets$10,520,000

Its operating profit (EBIT) is expected to be $2.9 million. Its tax rate is 30 percent. Shares are valued at $20. Capital structure is either short-term financing at 5 percent or equity. There is no long-term debt. (Round the final answers to 2 decimal places.)

a. Calculate expected earnings per share (EPS) if the firm is perfectly hedged.

EPS $

b. Calculate expected EPS if it has a capital structure of 30% debt.

EPS $

c. Recalculate a and b if short-term rates go to 12 percent.

EPS Hedged$ Capital structure

Reference no: EM132341457

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