What is the degree of operating leaverage general accounting when annual sales are 150,000? Tech Gadgets manufactures electronic devices that sell for $75 each. Annualnon-depreciation fixed costs are $12,000, and variable costs are $45 per unit.The initial equipment investment of $36,000 will be depreciated using thestraight-line method over 9 years to a salvage value of $0. The company usesa discount rate of 10%. What is the degree of operating leverage whenannual sales are $150,000?

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

Answered: Tech Gadgets manufactures electronic…

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter10: Capital Budgeting: Decision Criteria And Real Option

Section: Chapter Questions

Problem 3P

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