Resoneffect Inc. has a degree of pretax cash flow operating leverage equal to 1.12. If the firm's EBITDA was $2,000 last year while its depreciation and amortization expense was $150 in the same year, then what was the firm's degree of accounting operating leverage?

Resoneffect Inc. has a degree of pretax cash flow operating leverage equal to 1.12. If the firm's EBITDA was $2,000 last year while its depreciation and amortization expense was $150 in the same year, then what was the firm's degree of accounting operating leverage?

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter6: Accounting For Financial Management

Section: Chapter Questions

Problem 4P: Talbot Enterprises recently reported an EBITDA of $8 million and net income of $2.4 million. It had...

See similar textbooks

Related questions

Q: hi expert please help me accounting questions

A: Step 1: Definition of Cash Conversion Cycle (CCC)The Cash Conversion Cycle (CCC) measures the time…

Q: Accounting question

A: 1. Calculate the Cost of Equity (Re):We'll use the Capital Asset Pricing Model (CAPM):Re = Risk-Free…

Q: hello tutor please help me

A: Step 1: Definition of Accounts ReceivableAccounts Receivable represents the amount a company is…

Q: please give me true answer

A: Step 1: Definition of Bank ReconciliationA bank reconciliation is a process that matches a company's…

Q: kindly help me with accounting questions

A: Step 1: Definition of Job CostsJob costs refer to the total expenses incurred for a specific job,…

Q: please give me true answer account qestions

A: Step 1: Definition of Advertising Expense AllocationAdvertising expenses are indirect costs that…

Q: Calculate the ending merchandise inventory?

A: Explanation of Perpetual Inventory System: The perpetual inventory system is a method of accounting…

Q: Need correct answer general accounting question

A: Step 1: Define Equivalent Units of Production (EUP) for Conversion CostsEquivalent units of…

Q: General Accounting

A: Concept of Debt-Equity RatioThe debt-equity ratio is a financial metric that measures a company's…

Q: 4 POINTS

A: Step 1: DefinitionsConcept of the Direct Method of Cost AllocationThe Direct Method of Cost…

Q: Need Ans general accounting question

A: Step 1: Define indifference Tax RateThe indifference tax rate is the dividend tax rate at which an…

Q: Answer? ? General accounting question

A: Step 1: Define Overhead Applied to Work in ProcessOverhead Applied to Work in Process represents the…

Q: Don't use ai given answer accounting questions

A: Calculate Earnings Before Interest and Taxes (EBIT):EBIT = Annual Revenue - Depreciation Expense -…

Q: Financial accounting question

A: Step 1: Define Stock Price Calculation Using P/E RatioThe Price-to-Earnings (P/E) Ratio is a…

Q: Hi expert please give me answer general accounting question

A: Step 1: Definition of Break-even Sales RevenueBreak-even sales revenue is the amount of sales a…

Q: General accounting 5

A: Step 1: Recall the contribution margin formula.Contribution margin = Sales - Variable costsStep 2:…

Q: Please give me answer general accounting question

A: 1. Gross profit = Sales - Cost of goods soldGross profit = 920,000 - 368,000Gross profit = 552,000…

Q: General Accounting Question solution please

A: Step 1: Determine the carrying amount of the delivery truck.= purchase cost - accumulated…

Q: hello teacher please solve questions

A: Given Data:Sales = 12,000,000ROE = 12% = 0.12Total Assets Turnover = 4Common Equity = 40% of Total…

Q: Allocation advertisement expense to department Y

A: Explanation of Advertising Expense Allocation:The Advertising Expense Allocation refers to the…

Q: Lavu's Cakes produces muffins, which sell for $6.20 each. During the current month, Lavu produced…

A: Step 1: Definition of Product Cost under Absorption CostingProduct cost under absorption costing…

Q: expert of account answer

A: Step 1: Definition of Net IncomeNet income represents a company's total earnings after deducting all…

Q: Provide answer

A: Explanation of Net Realizable Value (NRV): Net realizable value represents the estimated selling…

Q: What is the correct option?

A: Step 1: Define Lower-of-Cost-or-Market (LCM) RuleThe Lower-of-Cost-or-Market (LCM) rule states that…

Q: What is the a and b ? General accounting question

A: Step 1: Define Firm Value Before and After Credit DowngradeThe firm value represents the total worth…

Q: None

A: a) Debt-to-Equity RatioGiven:Total Liabilities = 500,000Total Equity = 300,000Debt-to-Equity Ratio =…

Q: Opal works for Clarendon Ltd. in Jamaica. She received her notice of assessment on April 10, and was…

A: Opal, an employee of Clarendon Ltd. in Jamaica, received her notice of assessment on April 10. She…

Q: i want to this account question answer

A: Detailed explanation: The Pretax Income CalculationWhen a commercial enterprise wants to determine…

Q: Can you help me with accounting questions

A: Step 1: Definition of Gross ProfitGross profit is the difference between a company's total sales and…

Q: provide correct answer A B

A: Step 1: Definition of Financial Ratios In accounting, there are various financial ratios used to…

Q: Hii ticher please given answer general financial accounting

Q: Do fast answer of this accounting questions

A: Step 1: Definition of Cost of Goods Sold (COGS) The cost of goods sold (COGS) is the direct cost of…

Q: On January 1, 20X2, Mace, which uses the straight-line method, purchases a machine for $72,000 that…

A: Explanation of Straight-Line Depreciation:Straight-line depreciation is a method of allocating the…

Q: What is the net income payable after the discount

A: Approach to solving the question:For better clarity of the solution, I have provided both the…

Q: Valuation for the company total inventory

A: The lower-of-cost-or-net realizable value (LCM/NRV) is an accounting principle that requires…

Q: Kindly help me with accounting questions

A: Step 1: Definition of Receivables Turnover RatioThe receivables turnover ratio measures how…

Q: What is the net income for the year?

A: Change in Retained Earnings=Net Income−Dividends Calculation of Net Income for the yearNet Income…

Q: need correct ans ?Financial Accounting

A: Step 1: Define Net IncomeNet Income is the total earnings of a company after considering revenues,…

Q: i want to correct answer

Q: ANSWER PLZ

A: Step 1: Definition of Recognized Gain/LossRecognized gain is the excess of the selling price over…

Q: Need help

A: To get the depreciation expense, we follow this formula:Depreciation Expense = ((Cost basis of fixed…

Q: can you please give answer

A: Step 1: Definition of Degree of Operating Leverage (DOL)The Degree of Operating Leverage (DOL)…

Q: Need help with this question solution general accounting

A: Divide the variable costs by the sales and then multiply the result by 100% to get the variable…

Q: Use the following table of government officers travelling and mileage allowance to answer the…

A: From the question, we know that Lisa Chapelle made 2 site visits, each 750 km, and also travelled an…

Q: Don't use ai given answer general accounting question

A: Step 1: Definition of Markup PricingMarkup pricing refers to the practice where a company sets the…

Q: hello teacher please solve questions

A: Step 1: Definition of Cash Conversion Cycle (CCC)The Cash Conversion Cycle (CCC) measures the time…

Q: do fast answer of this account questions

A: Step 1: Definition of Contribution Margin RatioThe Contribution Margin Ratio (CMR) represents the…

Q: Need help with this question solution general accounting

A: Step 1: Calculation of Ending EquityEnding Equity = Ending Total Assets - Ending Total…

Q: Please give me true answer this financial accounting question

A: Step 1: Definition of Real Risk-Free RateThe real risk-free rate represents the return on a…

Q: The direct material quantity variance

A: Explanation of Direct Materials Price Variance:Direct Materials Price Variance measures the…

Question

please solve this problem account questions

Resoneffect Inc. has a degree of pretax cash flow
operating leverage equal to 1.12. If the firm's
EBITDA was $2,000 last year while its depreciation
and amortization expense was $150 in the same
year, then what was the firm's degree of accounting
operating leverage?

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

General accounting
Consider the following data (be careful there might be some "unnecessary" information). EBIT = 176 Interest expense = 10 Tax rate = 30% Depreciation = 38 Net working capital = 30 Increase in net working capital = 10 Beginning of period Net PP&E = 50 Capex = 16 What is the free cash flow of the firm that year?
A firm has $600,00 in current assets and $150,000 in current liabilities. If it uses cash to pay $50,000 in accounts recievalbes will the current ratio increase or decraese? Will the net working capital increase or decrease or stay the same? Why?
Ohio Steel has a degree of operating leverage of 2.9. The company predicted EBIT of $332,000 and EPS of $5.7 for the year. Actual EBIT were $284,000 and EPS were $2.42. What is the degree of financial leverage? What is the degree of total leverage? What were earnings before taxes (EBIT - Interest)? What was the company's gross profit (sales - variable costs)?
1.A Assume that a Peruvian company, DMB LLC, just reported its earnings this year. The reported revenue was $10 million and the reported cost was $9 million. The discount rate is 8%. Mark ALL the CORRECT statements. For this question, profit = revenue - cost. Hint: Apply the Gordon Formula to the profits of the firm. a) If the profit is expected to be constant, the present value of all the company's future profits is $125 million. b) If the profit is expected to grow 3% annually, the present value of all the company's future profits is $20 million. c) If the profit is expected to grow 4% annually, the present value of all the company's future profits is $25.75 million. d) If the profit is expected to grow 6% annually, the present value of all the company's future profits is $50 million. e) If the profit is expected to grow 10% annually, the present value of all the company's future profits is negative.
What is the return on capital employed of this financial accounting question?
It is known that a firm’s Net Operating Profit After Tax (NOPAT) is $58,000 and its Economic Value Added (EVA) is $18,000. What is the firm’s Weighted Average Cost of Capital (WACC) if its debt is $150,000 and equity is $250,000?
What is JJ's degree of operating leverage??
What is the firms ROE?
Suppose Alcatel-Lucent has an equity cost of capital of 9.2%, market capitalization of $10.95 billion, and an enterprise value of $15 billion. Suppose Alcatel-Lucent's debt cost of capital is 6.9% and its marginal tax rate is 38%. a. What is Alcatel-Lucent's WACC? b. If Alcatel-Lucent maintains a constant debt-equity ratio, what is the value of a project with average risk and the expected free cash flows as shown here,? c. If Alcatel-Lucent maintains its debt-equity ratio, what is the debt capacity of the project in part (b)? a. What is Alcatel-Lucent's WACC? Alcatel-Lucent's WACC is%. (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Year 0 1 FCF ($ million) - 100 50 Print C Done 2 99 3 66 X
Suppose Alcatel-Lucent has an equity cost of capital of 10.4%, market capitalization of $11.52 billion, and an enterprise value of $16 billion. Suppose Alcatel-Lucent's debt cost of capital is 6.6% and its marginal tax rate is 34%. a. What is Alcatel-Lucent's WACC? b. If Alcatel-Lucent maintains a constant debt-equity ratio, what is the value of a project with average risk and the expected free cash flows as shown here, ? c. If Alcatel-Lucent maintains its debt-equity ratio, what is the debt capacity of the project in part (b)? a. What is Alcatel-Lucent's WACC? Alcatel-Lucent's WACC is 9.34 %. (Round to two decimal places.) Data table (Click on the following icon in order to copy its contents into a spreadsheet.) Year 1 FCF ($ million) 45 Print 0 - 100 Done 2 101 3 66 - X
What is the firm roe ? Accounting