Show algebraically that Equation 14.2: Is equivalent to Equation14.1: Sales Variable costs EBIT DOL at X EBIT/EBIT

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Show algebraically that Equation 14.2:

Is equivalent to Equation14.1:

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Contemporary Financial Management

ISBN: 9780324289114

10th Edition

Authors: James R Mcguigan, R Charles Moyer, William J Kretlow

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Question Posted: Jul 17, 2012 03:30 AM

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Show algebraically that Equation 14.2: Is equivalent to Equation14.1: Sales Variable costs EBIT DOL at X EBIT/EBIT

Question:

Sales Variable costs EBIT DOL at X ΔEBIT/EBIT DOL at XASales/Sales

Step by Step Answer:

Sales P x Q EBIT P x Q F V x Q where P priceunit F fixed cost V variable costu...View the full answer

Contemporary Financial Management

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