Question: how do you calculate the DFL . show the formula you use a. Calculate the operating breakeven point in units. Sale price per unit Variable

how do you calculate the DFL . show the formula you use

a. Calculate the operating breakeven point in units. Sale price per unit Variable operating cost per unit Fixed operating cost Breakeven quantity beach balls $1,000 S0,84 S28 000 175 000 b. Use the degree of operating leverage (DOL) formula to calculate DOL. Units Selling price Variable operating costs Fixed operating costs Degree of operating leverage 400 000 $1,000 S0,84 S28 000 -28 000,00 c. Use the degree of financial leverage (DFL) formula to calculate DFL. EBIT Annual interest Preferred stock dividend Tax rate Degree of financial leverage S36 000 S6 000 S2 000 21%

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