The following information relates to ABX Corporation: • • • Sales Revenue = $600,000 (12,000 units @ $50/unit) Variable Costs of Operations = $240,000 (12,000 units @ $20/unit) Contribution Margin = $360,000 . Fixed Costs of Operation = $250,000 • Operating Income (EBIT) = $110,000 • Interest Expense = $40,000 Earnings Before Taxes (EBT) = $70,000 What is ABX Corporation's Degree of Operating Leverage (DOL)? Options: a) 1.5 b) 2.0 c) 3.0 d) 4.0

The following information relates to ABX Corporation: • • • Sales Revenue = $600,000 (12,000 units @ $50/unit) Variable Costs of Operations = $240,000 (12,000 units @ $20/unit) Contribution Margin = $360,000 . Fixed Costs of Operation = $250,000 • Operating Income (EBIT) = $110,000 • Interest Expense = $40,000 Earnings Before Taxes (EBT) = $70,000 What is ABX Corporation's Degree of Operating Leverage (DOL)? Options: a) 1.5 b) 2.0 c) 3.0 d) 4.0

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter14: Decentralized Operations

Section: Chapter Questions

Problem 3SEQ: Division A of Kern Co. has sales of $350,000, cost of goods sold of $200,000, operating expenses of...

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