Following is the latest income statement for Surfside Airlines: Sales $150,000 Variable operating costs .. (105,000)

Question:

Following is the latest income statement for Surfside Airlines:

Sales …………………………………………………    $150,000

Variable operating costs …………………..     (105,000)

Gross profit …………………………........……        45,000

Fixed operating costs ………………………       (20,000)

Net operating income …………………..…        25,000

Interest ……………………………..............…       (15,000)

Earnings before taxes .........................        10,000

Taxes (40%) …………………………......……          (4,000)

Net income …………………………….....…..       $ 6,000

Compute Surfside’s degree of operating leverage (DOL), degree of financial leverage (DFL), and degree of total leverage (DTL).

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

CFIN

ISBN: 978-1305666870

5th edition

Authors: Scott Besley, Eugene Brigham

Question Posted: