Question: Problem 11-13 Operating Cash Flow and Leverage [LO4] A proposed project has fixed costs of $72,000 per year. The operating cash flow at 6,200 units
![Problem 11-13 Operating Cash Flow and Leverage [LO4] A proposed project](https://dsd5zvtm8ll6.cloudfront.net/si.experts.images/questions/2024/09/66f95ff7f3d2d_06366f95ff79a381.jpg)
Problem 11-13 Operating Cash Flow and Leverage [LO4] A proposed project has fixed costs of $72,000 per year. The operating cash flow at 6,200 units is $95,400. lgnoring the effect of taxes, what is the degree of operating leverage? (Do not round intermediate calculations. Round your answer to 4 decimal places, e.g., 32.1616.) Degree of operating leverage 1.86 If units sold rise from 6,200 to 6,700, what will be the new operating cash flow? (Do not round intermediate calculations. Round your answer to 2 decimal places, e.g., 32.16.) Operating cash flow $ 98,960 What is the new degree of operating leverage? (Do not round intermediate calculations. Round your answer to 4 decimal places, e.g., 32.1616.) New DOL 1.77
Step by Step Solution
There are 3 Steps involved in it
Get step-by-step solutions from verified subject matter experts
