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The following information relates to BRF Corporation: Sales Revenue $500 000 (10 000 units @ $50/unit) Variable costs of Operations $200 000 (10 000 @ $20/unit) Contribution Margin $300 000 Fixed Cost of Operation $200 000 Operation Income (EBIT) $100 000 Interest Expense $50 000 Earnings before Taxes (EBT) $50 000 What is BRF Corporation's degree of operating leverage (DOL)?

The following information relates to BRF Corporation: Sales Revenue $500 000 (10 000 units @ $50/unit) Variable costs of Operations $200 000 (10 000 @ $20/unit) Contribution Margin $300 000 Fixed Cost of Operation $200 000 Operation Income (EBIT) $100 000 Interest Expense $50 000 Earnings before Taxes (EBT) $50 000 What is BRF Corporation's degree of operating leverage (DOL)?

FINANCIAL ACCOUNTING
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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The following information relates to BRF Corporation: Sales Revenue $500 000 (10 000 units @ $50/unit) Variable costs of Operations $200 000 (10 000 @ $20/unit) Contribution Margin $300 000 Fixed Cost of Operation $200 000 Operation Income (EBIT) $100 000 Interest Expense $50 000 Earnings before Taxes (EBT) $50 000 What is BRF Corporation's degree of operating leverage (DOL)?
Transcribed Image Text:The following information relates to BRF Corporation: Sales Revenue $500 000 (10 000 units @ $50/unit) Variable costs of Operations $200 000 (10 000 @ $20/unit) Contribution Margin $300 000 Fixed Cost of Operation $200 000 Operation Income (EBIT) $100 000 Interest Expense $50 000 Earnings before Taxes (EBT) $50 000 What is BRF Corporation's degree of operating leverage (DOL)?
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