Use the below information to answer the following question. Sales (100,000 units) $ 1,000,000 Variable costs 300,000 Contribution margin 700,000 Fixed manufacturing costs 200,000 Operating income 500,000 Interest 75,000 Earnings before taxes 425,000 Taxes (30%) 127,500 Net income $ 297,500 Refer to the table. The degree of financial leverage is _____
Use the below information to answer the following question. Sales (100,000 units) $ 1,000,000 Variable costs 300,000 Contribution margin 700,000 Fixed manufacturing costs 200,000 Operating income 500,000 Interest 75,000 Earnings before taxes 425,000 Taxes (30%) 127,500 Net income $ 297,500 Refer to the table. The degree of financial leverage is _____
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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Use the below information to answer the following question.
| Sales (100,000 units) | $ | 1,000,000 | |
| Variable costs | 300,000 | ||
| Contribution margin | 700,000 | ||
| Fixed |
200,000 | ||
| Operating income | 500,000 | ||
| Interest | 75,000 | ||
| Earnings before taxes | 425,000 | ||
| Taxes (30%) | 127,500 | ||
| Net income | $ | 297,500 | |
Refer to the table. The degree of financial leverage is _____
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