Question: Given the following data for Baltimore Technology, compute the firm's degree of combined leverage. Assume a corporate tax rate of 25%. Select the closest answer.

Given the following data for Baltimore Technology, compute the firm's degree of combined leverage. Assume a corporate tax rate of 25%. Select the closest answer.

2019: Sales = $700,000; Fixed costs = $175,000; Variable costs = $294,000; Interest = $43,000; Shares outstanding = 120,000

2020: Sales = $760,000; Fixed costs = $175,000; Variable costs = $319,200: Interest = $43,000; Shares outstanding = 120,000

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