Allied Biscuit Co. forecasts the following income statement for the next year: Income Statement For the Year
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Question:
Allied Biscuit Co. forecasts the following income statement for the next year:
Income Statement For the Year Ended on December 31
Net sales | $960,000 |
Less: Variable costs | 532,000 |
Less: Fixed costs | 167,000 |
EBIT, or NOI | $261,000 |
Less: Interest | 141,000 |
EBT | $120,000 |
Less: Taxes | 48,000 |
Net income | $72,000 |
Allied Biscuit Co. uses no preferred stock in its capital structure. Click on the following lines and calculate the degrees of operating, financial, and total leverage for Allied Biscuit Co.
DOL | 1. A 1.39 B. 1.64 C. 1.44 D. 1.69 E 1.57 |
DFL | 2. A 2.07 B.2.50 C 2.86 D 2.33 E 2.68 F 2.18 G 1.93 |
DTL | 3 A 3.66 B 3.75 C 3.42 D 3.86 E 3.51 F 3.57 G 3.96 |
Related Book For
Contemporary Financial Management
ISBN: 978-1285198842
13th edition
Authors: R. Charles Moyer, James R. McGuigan, Ramesh P. Rao
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