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b. Compute the degree of financial leverage. (Round your answer to 2 decimal places.) Degree of financial leverage c. Compute the degree of combined leverage.
b. Compute the degree of financial leverage. (Round your answer to 2 decimal places.) Degree of financial leverage c. Compute the degree of combined leverage. (Round your answer to 2 decimal places.) Degree of combined leverage d. Compute the break-even point in units (number of skates). (Round your answer to the nearest whole number.) Break-even point skates The Harding Company manufactures skates. The company's income statement for 20X1 is as follows: HARDING COMPANY Income Statement For the Year Ended December 31, 20X1 Sales (11,400 skates @ $78 each) $ 889,200 Variable costs (11,400 skates at $34) 387,600 Fixed costs 290,000 Earnings before interest and taxes $ 211,600 (EBIT) Interest expense 67,000 Earnings before taxes (EBT) $ 144,600 Income tax expense (30%) 43,380 Earnings after taxes (EAT) $ 101, 220 a. Compute the degree of operating leverage. (Round your answer to 2 decimal places.) Degree of operating leverage b. Compute the degree of financial leverage. (Round your answer to 2 decimal places.) Degree of financial leverage
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