7A4:

The Poseidon Swim Company produces swim trunks. The average selling price for one of their swim trunks is $68.90. The variable cost per unit is $22.39, Poseidon Swim has average fixed costs per year of $5,072.

Determine the degree of operating leverage for the level of production and sales 381 swim trunks.

Round the answer to two decimal places.

7B4:

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

Average selling price per unit $345.

Variable cost per unit $195

Units sold 489

Fixed costs $8,709

Interest expense 14,545

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 2.7 percent?

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

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

Round the answer to two decimals

7E4:

Genetic Insights Co. purchases an asset for $18,842. This asset qualifies as a seven-year recovery asset under MACRS. The seven-year fixed depreciation percentages for years 1, 2, 3, 4, 5, and 6 are 14.29%, 24.49%, 17.49%, 12.49%, 8.93%, and 8.93%, respectively. Genetic Insights has a tax rate of 30%. The asset is sold at the end of six years for $4,031.

Calculate tax paid on gain on disposal.Round the answer to two decimals.