For a business firm leverage is about the fixed operating cost and the fixed finance costs...

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For a business firm leverage is about the fixed operating cost and the fixed finance costs in the cost structure of the firm. For the given details, identify for which firm the degree of operating leverage and degree of financial leverage are higher and why so? Firms Sales (Rs.) Variable cost p.u Fixed cost (Rs.) Output (units) Interest Amrit Baayu 3,60,000 7,50,000 20 150 72,000 1,40,000 6,000 1,500 40,000 80,000 For a business firm leverage is about the fixed operating cost and the fixed finance costs in the cost structure of the firm. For the given details, identify for which firm the degree of operating leverage and degree of financial leverage are higher and why so? Firms Sales (Rs.) Variable cost p.u Fixed cost (Rs.) Output (units) Interest Amrit Baayu 3,60,000 7,50,000 20 150 72,000 1,40,000 6,000 1,500 40,000 80,000

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I II Explanation i Hence the earnings before taxes for Amrit an... View the full answer