Company manufactures skates. The company’s income statement for 2013 is as follows:

HARDING COMPANY

Income Statement

For the Year Ended December 31, 2013

Sales (10,500 skates @ $60 each) .........$630,000

Less: Variable costs (10,500 skates at $25) ...... 262,500

Fixed costs .................... 200,000

Earnings before interest and taxes (EBIT) ........ 167,500

Interest expense .................. 62,500

Earnings before taxes (EBT) ............ 105,000

Income tax expense (30%) .............. 31,500

Earnings after taxes (EAT) ..............$ 73,500

Given this income statement, compute the following:

a. Degree of operating leverage.

b. Degree of financial leverage.

c. Degree of combined leverage.

d. Break-even point in units (number of skates).