Question: PLEASE ANSWER QUESTIONS A, B and C A - Last year, Cayman Corporation had sales of $26 million, total variable costs of $14 million, and

PLEASE ANSWER QUESTIONS A, B and C

A - Last year, Cayman Corporation had sales of $26 million, total variable costs of $14 million, and total fixed costs of $5,000,000. In addition, they paid $3 million in interest to bondholders. Cayman has a marginal tax rate of 21 percent. If Cayman's sales increase by 15%, what should be the increase in operating income? SET YOUR CALCULATOR TO 4 DECIMAL PLACES THEN ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. FOR EXAMPLE, IF YOUR ANSWER IS 12.7125, ENTER IT AS 12.71.

B - Last year, Cayman Corporation had sales of $6 million, total variable costs of $3 million, and total fixed costs of $1 million. In addition, they paid $480,000 in interest to bondholders. Cayman has a 21% marginal tax rate. If Cayman's sales increase 6%, what should be the increase in operating income? SET YOUR CALCULATOR TO 4 DECIMAL PLACES. ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. FOR EXAMPLE, IF YOUR ANSWER IS 9.4567, ENTER IT AS 9.46.

C - Last year, Cayman Corporation had sales of $6,722,184, total variable costs of $2,839,386, and total fixed costs of $1,521,245. In addition, they paid $480,000 in interest to bondholders. Cayman has a 21% marginal tax rate. If Cayman's sales increase 6%, what should be the increase in earnings per share? SET YOUR CALCULATOR TO 4 DECIMAL PLACES. ROUND TO 2 DECIMAL PLACES AT THE END. DO NOT ENTER THE % SIGN. FOR EXAMPLE, IF YOUR ANSWER IS 9.4567, ENTER IT AS 9.46.

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