Question
1.A new restaurant is ready to open for business. It is estimated that the food cost (variable cost) will be 40% of sales, while fixed
1.A new restaurant is ready to open for business. It is estimated that the food cost (variable cost) will be 40% of sales, while fixed cost will be $457,886. The first years sales estimates are $1,250,000. Calculate the firms degree of operating leverage (DOL). Answer to 2 decimal places.
2.
A new restaurant is ready to open for business. It is estimated that the food cost (variable cost) will be 62.75% of sales, while fixed cost will be $450,000. The first years sales estimates are $1,127,595. Calculate the firms operating breakeven level of sales. Answer to 2 decimal places.
3.
Maverick Technologies has sales of $3,000,000. The companys fixed operating costs total $515,314 and its variable costs equal 60% of sales. The companys interest expense is $500,000. What is the companys degree of total leverage (DTL)? Answer to 2 decimal places.
4.
Maverick Technologies has sales of $3,000,000. The companys fixed operating costs total $500,000 and its variable costs equal 60% of sales, so the companys current operating income is $700,000. The companys interest expense is $492,284. What is the companys degree of financial leverage (DFL)? Answer to 2 decimal places.
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