Question

Sinclair Manufacturing and Boswell Brothers Inc. are both involved in the production of brick for the homebuilding industry. Their financial information is as follows:


a. If you combine Sinclair’s capital structure with Boswell’s operating plan, what is the degree of combined leverage? (Round to two places to the right of the decimal point.)
b. If you combine Boswell’s capital structure with Sinclair’s operating plan, what is the degree of combined leverage?
c. Explain why you got the results you did in part b.
d. In part b, if sales double, by what percentage will EPSincrease?


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  • CreatedOctober 14, 2014
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