What is McGonnigal’s degree of operating leverage at a sales level of $45 million? Round your answer to three decimal places. What is McGonnigal’s current degree of financial leverage? Round your answer to three decimal places. Forecast McGonnigal’s EPS if sales drop to $43.2 million. Round your answer to the nearest cent.
McGonnigal Inc. has expected sales of $45 million. Fixed operating costs are $5 million, and the variable cost ratio is 60 percent. McGonnigal has outstanding a $5 million, 9 percent bank loan and $3 million in 10 percent coupon-rate bonds. McGonnigal has outstanding 200,000 shares of an $11 (dividend)
-
What is McGonnigal’s degree of operating leverage at a sales level of $45 million? Round your answer to three decimal places.
-
What is McGonnigal’s current degree of financial leverage? Round your answer to three decimal places.
-
Forecast McGonnigal’s EPS if sales drop to $43.2 million. Round your answer to the nearest cent.$
Step by step
Solved in 2 steps
