Stevenson's Bakery is an all-equity company that has projected perpetual earnings before interest and taxes of $43,700 a year. The cost of equity is 15.2 percent and the tax rate is 34 percent. The company can borrow money at 7.15 percent. If the company borrows $50,000, what will be its levered value? a. $187,613
b. $189,919
c. $206,750
d. $229,507
e. $203,682

Cherokee inc. is a merchandiser that provided the following information: amount number of units sold 20,000 selling price per unit $ 30 variable selling expense per unit $ 4 variable administrative expense per unit $ 2 total fixed selling expense $ 40,000 total fixed administrative expense $ 30,000 beginning merchandise inventory $ 24,000 ending merchandise inventory $ 44,000 merchandise purchases $ 180,000 required: 1. prepare a traditional income statement. 2. prepare a contribution format income statement.