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1. Meyer Appliance Company makes cooling fans. The firm's income statement is as follows: Sales (7,000 fans at $20) Less: Variable costs (7,000 fans at

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1. Meyer Appliance Company makes cooling fans. The firm's income statement is as follows: Sales (7,000 fans at $20) Less: Variable costs (7,000 fans at $8).. Fixed operating costs... Earnings before interest and taxes (EBIT) Interest (1).. Earnings before taxes (EBT). Taxes (T). Earnings after taxes (EAT). Preferred stock dividends (PD). Compute: a. The break-even point. b. Degree of operating leverage. c. Degree of financial leverage. d. Degree of total leverage. $140,000 56,000 44,000 $ 40,000 10,000 $ 30,000 6,000 $ 24,000 $ 6,000

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