The JLS Trucking Company currently has assets of $30 million, a tax rate of 35%, an expected ROA(EBIT/Assets) of 12%, and an ROA standard deviation of 6%. JLS has $9 million of debt with an interest rate of 8%.

1) What is the probability that JLS will have a coverage ratio (EBIT/Interest) of less than 1.0?

2) What is the maximum amount of debt the company can borrow and have no greater than 3% probability that the coverage ratio will fall to 1.0 0r less?

3) On average, companies in the trucking industry have an average of 2.12 standard deviations between their mean ROA and the ROA necessary to meet fixedcharge is the implied probability that the average company in the trucking industry to meet its fixed charge obligations?