LMN Ltd sells 2.0m units of its product Y per year at a selling price of R200 per unit. Variable costs are R125 per unit. Fixed costs are R100m per year. What is the degree of operating leverage (DOL) at the current level of sales? DOL = 3.50 b. DOL = 2.00 c. DOL = 1.50 d. DOL = 2.25 e. DOL = 3.00

LMN Ltd sells 2.0m units of its product Y per year at a selling price of R200 per unit. Variable costs are R125 per unit. Fixed costs are R100m per year. What is the degree of operating leverage (DOL) at the current level of sales? DOL = 3.50 b. DOL = 2.00 c. DOL = 1.50 d. DOL = 2.25 e. DOL = 3.00

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

DOL = 3.50

DOL = 2.00

DOL = 1.50

DOL = 2.25

DOL = 3.00

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