The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $70.43. The variable cost per unit is $19.96, Poseidon Swim has average fixed costs per year of $5,278. Assume that current level of sales is 320 units. What will be the resulting percentage change in EBIT if they expect units sold to changes by -1.1 percent? (You should calculate the degree of operating leverage first). (Write the percentage sign in the "units" box). Round the answer to two decimal places
The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $70.43. The variable cost per unit is $19.96, Poseidon Swim has average fixed costs per year of $5,278. Assume that current level of sales is 320 units. What will be the resulting percentage change in EBIT if they expect units sold to changes by -1.1 percent? (You should calculate the degree of operating leverage first). (Write the percentage sign in the "units" box). Round the answer to two decimal places
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $70.43. The variable cost per unit is $19.96, Poseidon Swim has average fixed costs per year of $5,278. Assume that current level of sales is 320 units. What will be the resulting percentage change in EBIT if they expect units sold to changes by -1.1 percent? (You should calculate the degree of operating leverage first). (Write the percentage sign in the "units" box). Round the answer to two decimal places.
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