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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
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. a. Compute EPS if EBIT are $42,000,$50,400, and $66,000 (assume a 10 percent tax rate). (Round the final answers to 2 decimal places. Do not leave any empty spaces; input a 0 wherever it is required.) b. What is the relationship between EPS and level of EBIT? 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 $
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