18,000 Debt @ 8% $180,000 $360,000 Debt 8% Common stock 360,000 Common stock 180,000 Total $540,000 $540,000 Total 36,000 Common shares a. Compute EPS if EBIT are $36,000, $43,200, and $63,000 (assume a 10 percent tax rate). (Round the final answers to 2 decima places. Do not leave any empty spaces; input a 0 wherever it is required.) Cain Able Common shares EPS at $36,000 EPS at $43,200 EPS at $63,000 es es es es es es b. What is the relationship between EPS and level of EBIT? 1. Earnings before interest and taxes is less than cost of debt. 2. Earnings before interest and taxes equals cost of debt. 3. Earnings before interest and taxes is greater than cost of debt. (Click to select) (Click to select) (Click to select) c. If the cost of debt went up to 10 percent and all other factors remained equal, what would be the indifference point for EBIT? Break-even level $