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[The following information applies to the questions displayed below.] The financial statements for Limited Brands, Inc. follow (fiscal years ending January): [the> Please refer to

[The following information applies to the questions displayed below.]

The financial statements for Limited Brands, Inc. follow (fiscal years ending January):

[the> Please refer to Limited Brands, Inc.s financial statements above. Use the companys operating profit as an approximation of its EBIT, and assume a 40% tax rate for your calculations. What percentage decline in earnings before interest and taxes could Limited Brands have sustained in fiscal years ending in January 2006 and 2007 before failing to cover:

a. Interest and principal repayment requirements? b. Interest, principal, and common dividend payments?

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