can you please solve this question..??
The present earnings of a company before interest and tax is ? 10 lakhs. The company wants to increase its total capital investment by 50% through an issue of 10% debentures. At present the total capital of the company is 50 lakhs, out of which 40 lakh have been raised through equity and rest as that of 10% debentures. The tax levied is 40%. The face value of an equity share is ? 10 and that of a debenture is ?100..calculate the projected EPS of the company on issuing debentures. Show your working clearly, assuming that the ROI of the company remains unchanged.. do you think the company has taken the right decision by choosing debt to raise furthur capital.???