Given the following information for Computech, compute the firm’s degree of combined leverage (dollars are in thousands except EPS). Round your answer to one decimal place.     Year 1   Year 2 Sales   $550,000   $621,500 Fixed costs   110,000   110,000 Variable costs   200,000   226,000 Earnings before interest and taxes   $240,000   $285,500 Interest   25,000   25,000 Earnings per share (EPS)   $4.30   $5.21

FINANCIAL ACCOUNTING
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Chapter1: Financial Statements And Business Decisions
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Given the following information for Computech, compute the firm’s degree of combined leverage (dollars are in thousands except EPS). Round your answer to one decimal place.

    Year 1   Year 2
Sales   $550,000   $621,500
Fixed costs   110,000   110,000
Variable costs   200,000   226,000
Earnings before interest and taxes   $240,000   $285,500
Interest   25,000   25,000
Earnings per share (EPS)   $4.30   $5.21

 

Degree of combined leverage:

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