Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

a. Maverick Technologies has sales of $3,000,000. The companys fixed operating costs total $522,900 and its variable costs equal 60% of sales. The companys interest

a. Maverick Technologies has sales of $3,000,000. The companys fixed operating costs total $522,900 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

b. 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 $469,789. What is the companys degree of financial leverage (DFL)? Answer to 2 decimal places.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Economics And Personal Finance

Authors: Irvin Tucker, Joan Ryan

1st Edition

1133562108, 978-1133562108

More Books

Students also viewed these Finance questions

Question

List six common functional budgets.

Answered: 1 week ago

Question

Gambling by student and professional athletes

Answered: 1 week ago

Question

How does selection differ from recruitment ?

Answered: 1 week ago