Uptown Construction Is Comparing Two Different Capital Structures

question 86

Multiple Choice

Uptown Construction is comparing two different capital structures.Plan I would result in 23,000 shares of stock and $320,000 in debt.Plan II would result in 17,000 shares of stock and $260,000 in debt.The interest rate on the debt is 10 percent.Ignoring taxes,EPS will be identical for Plans I and II when EBIT equals which one of the following?

• A)$8,550
• B)$9,000
• C)$9,600
• D)$10,400
• E)$10,750

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Definitions:

Neuromuscular Junction

The synapse or junction where the motor neuron communicates with the skeletal muscle fiber to initiate muscle contraction.

Synaptic Vesicles

Membrane-bound sacs within a nerve cell (neuron) that contain neurotransmitters, which are released into the synaptic cleft to transmit signals between neurons.

Synaptic Cleft

The small gap between neurons at a synapse, through which neurotransmitters are released to transmit nerve impulses.

Presynaptic Terminal

The end point of a neuron that communicates with another neuron or muscle cell across a synapse, releasing neurotransmitters to transmit nerve impulses.