Assume that the net income will be absorbed by long-term debt, and the interest rate is 4% of the long-term debt. Set up an iterative worksheet to eliminate it.

To eliminate the net income by absorbing it with long-term debt, we'll use an iterative approach. Let's assume the long-term debt is initially zero. We'll calculate the interest on long-term debt (4% of the long-term debt) and subtract it from the net income.

Explanation:

The result will be the new net income, which will be used to calculate the interest on long-term debt again. We'll repeat this process until the net income becomes zero.