45. Your company is taking the loan of $1,260,000 for a new business plan. The interest rate is set at 6%. The entire debt must be paid in 5 years in an annuity payment plan. The Present Value Interest Factor for an Annuity (PVIFA at 6% interest rate for 5 years) is 4.2000. (This is a simplified index to make calculation easy.) The annual payment can be determined as follows:

Annual Payment = Long-term Debt Amount divided by the PVIFA

You want to find out whether your operations are strong enough to handle the interest payments on this loan. Provide the title of the account to check inside the document you answered in the previous question?

Group of answer choices

1) Eanrings before interest and taxes (EBIT)

2) Net Profit

3) Cash Flows from the Operating Activities

4) Cash Account