What was the firm's degree of accounting operating leverage on these financial accounting question? Velocity Dynamics Ltd. has a degree of pretax cash flow operating leverageequal to 1.20. If the firm's EBITDA was $3,000 last year while its depreciationand amortization expense was $200 in the same year, what was the firm'sdegree of accounting operating leverage?

Step 1: Contribution margin Contribution margin = EBITDA x Degree of pretax cash flow operating…

Answered: Velocity Dynamics Ltd. has a degree of…

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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Velocity Dynamics Ltd. has a degree of pretax cash flow operating leverage equal to 1.20. If the firm's EBITDA was $3,000 last year while its depreciation and amortization expense was $200 in the same year, what was the firm's degree of accounting operating leverage?