Assuming that a company improves its EBIT by 10%, what is the EBIT/EPS
for debt and equity financing and what are the financial implications?
 How would you find that?

The reference supplied below contains the procedure you need on slides 17-19.

The firm's EBIT-EPS is determined using the formula EPS = EAT/NS =
(EBIT - I)(1-t)/NS, where EAT is Earnings After Taxes, NS is the
number of common shares outstanding, it is the annual interest paid,
and t is the tax rate.

"The slope of the EBIT-EPS line for debt financing is always steeper
than that of the EBIT-EPS line for equity financing."  If EBIT is
below the indifference point, the equity financing alternative
produces higher EPS.  If EBIT is above the indifference point, the
debt financing alternative results in higher EPS.

Sincerely,

Wonko

Source: "Chapter 16 Operating and Financial Leverage" slides 17-19
web.utk.edu/~spark4/fin301/classnotes/ch16.ppt
or in HTML format:
http://64.233.179.104/search?q=cache:O4zIKn1QEj0J:web.utk.edu/~spark4/fin301/classnotes/ch16.ppt+EBIT/EPS&hl=en