7A

B

Use the following information about Rat Race Home Security, Inc. to answer the questions:

Average selling price per unit $333.

Variable cost per unit $180

Units sold 304

Fixed costs $7,837

Interest expense 14,967

Based on the data above, what will be the resulting percentage change in earnings per share of Rat Race Home Security, Inc. if they expect operating profit to change 6.1 percent?

(You should calculate the degree of financial leverage first).

(Write the percentage sign in the "units" box).

Round the answer to two decimals

8C

Cheeseburger and Taco Company purchases 19,285 boxes of cheese each year. It costs $11 to place and ship each order and $4.89 per year for each box held as inventory. The company is using Economic Order Quantity model in placing the orders.

Calculate Economic Order Quantity.

Round the answer to the whole number.

Your Answer:

The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $70.96. The variable cost per unit is $27.34, Poseidon Swim has average fixed costs per year of $9,132. Determine the degree of operating leverage for the level of production and sales 393 swim trunks. Round the answer to two decimal places. Your