calculate break even, cash break even, degree of operating leverage, degree of financial leverage, and degree of combined leverage and provide proof for your answers

95% damentals of Financial Management, Concise Edition, 9th Edition Aa 1) a D Chapter 3 Financial Statements, Cash Flow, and Taxes 93 3-15 INCOME STATEMENT Edmonds Industries is forecasting the following income statement: Challenging Problems 15-18 Sales Operating costs excluding depreciation & amortization EBITDA Depreciation and amortization EBIT $10,000,000 5,500,000 $ 4,500,000 1,200,000 $ 3,300,000 500,000 $ 2,800,000 1,120,000 $ 1,680,000 Interest EBT Taxes (40%) Net income The CEO would like to see higher sales and a forecasted net income of $2,100,000. Assume that operating costs (excluding depreciation and amortization) are 55% of sales and that depreciation and amortization and interest expenses will increase by 6%. The tax rate, which is 40%, will remain the same. (Note that while the tax rate remains constant, the taxes paid will change.) What level of sales would generate $2,100,000 in net income? FINANCIAL STATEMENTS The Davidson Corporation's balance sheet and income statement are provided here. 3-16