The cash flow approach to assessing debt capacity involves the following steps; arrange these steps in a correct sequence:

(A) Specify the tolerance limit on the probability of default.

(B) Estimate the probability distribution of cash flows, taking into account the projected performance of the firm.

(C) Calculate the fixed charges by way of interest payment and principal repayment associated with various levels of debt.

(D) Estimate the debt capacity of the firm as the highest level of debt which is acceptable.

Choose the correct answer from the options given below: