Author Question: Given the information in Figure 12.1, what is the break-even EBIT-EPS for Crane Manufacturing Inc.? ... (Read 31 times)

WhattoUnderstand · **on:** Jul 11, 2018

Given the information in Figure 12.1, what is the break-even EBIT-EPS for Crane Manufacturing Inc.?

A) EBIT = 100,000 and EPS = 0.15
B) EBIT = 250,000 and EPS = 0.35
C) EBIT = 350,000 and EPS = 0.45
D) EBIT = 400,000 and EPS = 0.65

Question 2

All of the following are commonly excluded by personal umbrella policies EXCEPT

A) acts committed with the intent to cause bodily injury or property damage.
B) professional liability.
C) aircraft liability.
D) libel, slander, and other types of personal injury.

jonathanballen97 · **Reply #1 on:** Jul 11, 2018

Answer to Question 1

B
Explanation: B) (EBIT-0)(1-t)/n = (EBIT - I)(1-t)/n
EBIT(.7)/500,000 = (EBIT - 100,000)(.7)/300,000, EBIT = 250,000 and EPS = 0.35.

Answer to Question 2

Answer: D