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stranahan stranahan
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7 years ago
Consider two companies that are alike except in borrowing choices. Barry Corp. has no debt financing, and Crawford Corp. uses debt financing. The EBIT for both companies is $100. Barry Corp. has 40 shares outstanding and pays no interest. Crawford Corp. has 30 shares outstanding and pays $25 in interest. What is the EPS for each company?
A) Barry Corp. has an EPS of $2.50 and Crawford Corp. has an EPS of $2.00.
B) Both companies have an EPS of $2.50.
C) Barry Corp. has an EPS of $2.00 and Crawford Corp. has an EPS of $2.50.
D) Both companies have an EPS of $2.00.
Textbook 
Financial Management: Core Concepts

Financial Management: Core Concepts


Edition: 2nd
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portalgoal!portalgoal!
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stranahan Author
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7 years ago
Thanks Smiling Face with Open Mouth and Tightly-closed Eyes
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