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What is the eps if the debt is issued

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Reference no: EM132601626

Southern Stone Corp is an all-equity firm. Its total market value is $695,000. The firm has 46,000 shares of stock outstanding. The management of the company is considering issuing $146,000 of debt at an interest rate of 8 percent. They will use the proceeds to repurchase shares. Before the debt issue, EBIT will be $60,800. What is the EPS if the debt is issued? Ignore taxes.

Reference no: EM132601626

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