What is the probability that casper company

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Cellar Door Garage, a motorcycle design fabricator, expects that it will have an EBIT figure of $2,500,000. The owner of Cellar Door Garage, Casper, expects that while this is the expected EBIT figure, there will be a degree of variability. The EBIT figure of $2,500,000 comes with a standard deviation of $800,000. Casper recognizes that he will have to incur interest charges of $1,200,000 and have to pay out preferred dividends of $300,000. If the company's marginal tax rate is 35%, what is the probability that Casper's company will have a negative EPS? Assume that EBIT will be normally distributed.

Reference no: EM132494804

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