Interest versus dividend expense Michaels Corporation expects earnings before interest and taxes to be $ 42 comma 000 for the current period. Assuming a flat ordinary tax rate of 22 % , 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 500 in interest. b. The firm pays $ 11 comma 500 in preferred stock dividends.
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