A firm has the following information for the last two years. Calculate its degree of financial leverage.

This year

Last year

Sales

$1,500,000

$1,300,000

Operating costs

$900,000

$800,000

Net income

$150,000

$120,000

Number of shares outstanding

50,000

50,000

Select one:

a.1.25

b.6.25

c.1.04

d.0.21

e.insufficient information to calculate DOL