McDonald Company shows the following condensed income statement information for the current year:

Required
Calculate the degree of financialleverage.

Transcribed Image Text:

3,500,000 (1.700,000) Revenue from sales Cost of products sold Gross profit Operating expenses: 1,800,000 Selling expenses S 425,000 General expenses Operating income Other income Interest Operating income before income taxes Taxes related to operations Income from operations Extraordinary loss (less app licable income (775,000) 1,025,000 20,000 70,000) 975,000 (335,000) 640,000 taxes of $40,000) Income before noncontro lling interest Noncontrolling interest (loss) Net income (80,000) 560,000 $ 510,000