Good morning

I am having trouble with this question, I am hoping you can help me, please and thank you.

(3 10) Cayman Auto has $600,000 up debt outstanding, and it pays an interest of interest rate of 8% annually: Cayman Autos annual sales are $3 million, its average tax rate is 25%, and its net profit margin is 3%. If the company does not maintain a TIE ratio of at least 5 times, its bank will refuse to renew the loan, and bankruptcy will result. What is Caymans Autos TIE ratio?

Step 1

Net Income = 3,000,000 * 0.03 = 90,000

Interest = 600,000 * 0.08 = 48,000

Net Income = EBIT Interest Taxes

90,000 = EBIT 48,000 - (EBIT 48,000) * 0.25

90,000 = EBIT 48,000 - 0.25 + 12,000

EBIT =