Provide answer general Accounting question Parker Manufacturing has sales of 5,000 unitsat $60 per unit. Variable costs are 40% of thesales price. If total fixed costs are $75,000,calculate the degree of operating leverage(DOL).

Step 1: Define Degree of Operating Leverage (DOL)The Degree of Operating Leverage (DOL) is a measure…

Answered: Parker Manufacturing has sales of 5,000…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter14: Capital Structure Management In Practice

Section14.A: Breakeven Analysis

Problem 7P

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Parker Manufacturing has sales of 5,000 units at $60 per unit. Variable costs are 40% of the sales price. If total fixed costs are $75,000, calculate the degree of operating leverage (DOL).