Brambles Limited has a debt ratio (debt to assets)of 40%.Management is wondering if its current capital structure is too conservative.Brambles' present EBIT is $4.5 million,and profits available to ordinary shareholders are $2,851,200,with 480,000 shares of ordinary shares outstanding.If the firm were to instead have a debt ratio of 60%,additional interest expense would cause profits available to shareholders to decline to $2,791,800,but only 384,000 ordinary shares would be outstanding.What is the difference in EPS at a debt ratio of 60% versus 40%?

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The Answer of Brambles Limited has a debt ratio (debt to assets)of 40%.Management is wondering if its current capital structure is too conservative.Brambles' present EBIT is $4.5 million,and profits available to ordinary shareholders are $2,851,200,with 480,000 shares of ordinary shares outstanding.If the firm were to instead have a debt ratio of 60%,additional interest expense would cause profits available to shareholders to decline to $2,791,800,but only 384,000 ordinary shares would be outstanding.What is the difference in EPS at a debt ratio of 60% versus 40%?

Brambles Limited Has a Debt Ratio (Debt to Assets)of 40