Michaels Corporation expects earnings before interest and
taxes to be $ 54 comma 000$54,000 for this period. Assuming an ordinary tax
rate of 35 %35%, compute the firm's earnings after taxes and earnings
available for common stockholders (earnings after taxes and preferred stock
dividends, if any) under the following conditions:
a. The firm pays $ 11 comma 900$11,900 in interest.
b. The firm pays $ 11 comma 900$11,900 in preferred stock
dividends.
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