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

-Use Limited Brands,Inc.'s financial statements,above,to answer the following question.Use the company's 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 2006 and 2007 before failing to cover:
a)Interest and principal repayment requirements;
b)Interest,principal and common dividend payments?

Question

The financial statements for Limited Brands, Inc. follow (fiscal years ending January):
  
-Use Limited Brands,Inc.'s financial statements,above,to answer the following question.Use the company's 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 2006 and 2007 before failing to cover:
a)Interest and principal repayment requirements;
b)Interest,principal and common dividend payments?

Quizplus · Accepted Answer

The Answer of The financial statements for Limited Brands, Inc. follow (fiscal years ending January):
  
-Use Limited Brands,Inc.'s financial statements,above,to answer the following question.Use the company's 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 2006 and 2007 before failing to cover:
a)Interest and principal repayment requirements;
b)Interest,principal and common dividend payments?

The Financial Statements for Limited Brands, Inc