E124 Parker Investments has EBIT of $20,000, interest expense of $3,000, and preferred dividends of $4,000. If

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E12–4 Parker Investments has EBIT of $20,000, interest expense of $3,000, and preferred dividends of $4,000. If it pays taxes at a rate of 38%, what is Parker’s degree of financial leverage (DFL) at a base level of EBIT of $20,000?

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