Victoria Dry Goods Has Expected Earnings Before Interest and Taxes

Multiple Choice

Victoria Dry Goods has expected earnings before interest and taxes of $14,600, an unlevered cost of capital of 15%, and a tax rate of 35%. The company also has $3,500 of debt that carries a 6%
Coupon. The debt is selling at par value. What is the value of this firm?

A) $63,267
B) $64,184
C) $64,492
D) $65,211
E) $66,267