Bintumani Mountain Apparatus Inc. produces tents at variable costs of $56 per tent. The fixed costs for the production are $99,850. The company sells tents to outdoor stores for $149 per tent.

a) How many tents does Bintumani Mountain Apparatus Inc. need to sell in order to break even? (Round UP result to whole dollars; No decimals).

b) What is the degree of operating leverage (DOL) at 1430 tents? (Round the result to 2 decimals).

c) How much profit or loss (before interest and taxes) will thecompany make if they sell 1430 tents? (enter result in whole dollars; No decimals; Use the minus sign for losses, e.g. -537; do not use a sign for gains, e.g. 537)

d) Assume that the earnings before interest and taxes is $40,000. If the company has annual interest payments of $8,773, what is the degree of financial leverage (DFL)? (Round the result to 2 decimals)

Answer rating: 100% (QA)

a To calculate the number of tents Bintumani Mountain Apparatus Inc needs to sell in order to break even we can use the formula Breakeven quantity Fix... View the full answer