Consider a firm with an EBIT of $858,000. The firm finances its assets with $2,580,000 debt (costing percent and is all tax deductible) and 480,000 shares of stock selling at $5.00 per shareTo reduce the firm's risk associated with this financial leverage, the firm is considering reducing its debt by $1,000,000 by selling an additional 280,000 shares of stockThe firm's tax rate is 21 percent The change in capital structure will have no effect on the operations of the firm. Thus, EBIT will remain at $858,000