Cain Auto Supplies and Able Auto Parts are competitors in the aftermarket for auto supplies. The separate capital structures for Cain and Able are presented below. Debt @ 10% Common stock Total Common shares EPS at $40,000 EPS at $60,000 EPS at $65,000 Cain S S Break-even level $200,000 400,000 $600,000 Cain 40,000 Debt @10% Common stock Total a. Compute EPS if EBIT are $40,000 $60,000, and $65,000 (assume a 30 percent tax rate). (Round the final answers to 2 decimal places. Do not leave any empty spaces; input a 0 wherever it is required.) Common shares Able b. What is the relationship between EPS and level of EBIT? Able 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. $400,000 200,000 $600,000 20,000 (Click to select) (Click to select) (Click to select) c. If the cost of debt went up to 12 percent and all other factors remained equal, what would be the indifference point for EBIT