rences 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 9% Common stock Total Common shares Cain Able $100,000 200,000 Debt 9% $200,000 Common stock 100,000 $300,000 Total $300,000 20,000 Common shares 10,000 a. Compute EPS if EBIT are $20,000, $27,000, and $55,000 (assume a 20 percent tax rate). (Round the final answers to 2 decimal places. Do not leave any empty spaces; Input a O wherever it is required.) Cain EPS at $20,000 $ EPS at $27,000 $ EPS at $55,000 $ Able b. What is the relationship between EPS and level of EBIT? 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. (Oick to select) (Click to select) (Click to select)