Question: 1 ) Use December 2 0 2 0 and December 2 0 2 1 Tesla Inc to compute DOL DFL DTL and answer the following
Use December and December Tesla Inc to compute DOL DFL DTL and answer the following questions:
Use DOL to compute change of EBIT for variation in Sales Revenue You have now data points with the middle one being the current year EBIT meaning
Use DFL to compute change of EPS for variation in EBIT You have now data points with the middle one being the current year
Compute the average change for EBIT and EPS Compute the standard deviations of change of EBIT and EPS
Identify for both the range for probability
Compute the breakeven EBIT for the given fiscal year Hint for breakeven the EPS is zero use the EPS formula from point
Compute the DEBITs and EPSs for the upper and lower bounds in point Is the breakeven EBIT in the range Use the following figure of the normal distribution as a guide for point
Assume now that the company has no debt which increases company shares by consider this plan E all equity and the original situation as plan L leveraged Use the formula below to compute the EBIT for the EPS indifference point between the two plans Which plan is better before the indifference point EBIT and which is better after guide yourself by figure in the textbook Can you draw a similar graph knowing the breakeven EBIT point for plan L computed at point and the EBIT for the EPS indifference point? Use the formula: EPS&EBITITDpsShrsC
Using DTL compute the EPS for the increase in sales between your fiscal year and the next and compare it with the actual EPS in the next year. Why do you think that there is a difference?
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