Question
At an output level of 17,500 units, you have calculated that the degree of operating leverage is 2.20. The operating cash flow is $64,500 in
At an output level of 17,500 units, you have calculated that the degree of operating leverage is 2.20. The operating cash flow is $64,500 in this case. Ignore the effect of taxes. Show how to do with financial calculator
a. What are fixed costs? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)
b. What will the operating cash flow be if output rises to 18,500 units? (Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)
c. What will the operating cash flow be if output falls to 16,500 units?
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