This question is based on "The WM Wrigley Jr. Company." Be sure to show all the work and formulas.

(1) Assume VL = VU + tc×B – C, where tc is the corporate tax rate, and C is the cost of financial distress. You estimate that if the company pursues the recapitalization plan, C will be $1 Billon. Given this estimate, calculate VL, SL, the stock price, and the number of shares outstanding after the recapitalization.